Correlation Between Aofu Environmental and Yankershop Food
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By analyzing existing cross correlation between Aofu Environmental Technology and Yankershop Food Co, you can compare the effects of market volatilities on Aofu Environmental and Yankershop Food and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Aofu Environmental with a short position of Yankershop Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aofu Environmental and Yankershop Food.
Diversification Opportunities for Aofu Environmental and Yankershop Food
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aofu and Yankershop is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Aofu Environmental Technology and Yankershop Food Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yankershop Food and Aofu Environmental is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Aofu Environmental Technology are associated (or correlated) with Yankershop Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yankershop Food has no effect on the direction of Aofu Environmental i.e., Aofu Environmental and Yankershop Food go up and down completely randomly.
Pair Corralation between Aofu Environmental and Yankershop Food
Assuming the 90 days trading horizon Aofu Environmental Technology is expected to generate 1.26 times more return on investment than Yankershop Food. However, Aofu Environmental is 1.26 times more volatile than Yankershop Food Co. It trades about -0.02 of its potential returns per unit of risk. Yankershop Food Co is currently generating about -0.04 per unit of risk. If you would invest 1,173 in Aofu Environmental Technology on August 27, 2024 and sell it today you would lose (30.00) from holding Aofu Environmental Technology or give up 2.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aofu Environmental Technology vs. Yankershop Food Co
Performance |
| Timeline |
| Aofu Environmental |
| Yankershop Food |
Aofu Environmental and Yankershop Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aofu Environmental and Yankershop Food
The main advantage of trading using opposite Aofu Environmental and Yankershop Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aofu Environmental position performs unexpectedly, Yankershop Food can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Yankershop Food will offset losses from the drop in Yankershop Food's long position.The idea behind Aofu Environmental Technology and Yankershop Food Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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