Correlation Between Aon PLC and Zhibao Technology
Can any of the company-specific risk be diversified away by investing in both Aon PLC and Zhibao Technology at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Aon PLC and Zhibao Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aon PLC and Zhibao Technology Class, you can compare the effects of market volatilities on Aon PLC and Zhibao Technology 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 Aon PLC with a short position of Zhibao Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aon PLC and Zhibao Technology.
Diversification Opportunities for Aon PLC and Zhibao Technology
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Aon and Zhibao is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Aon PLC and Zhibao Technology Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhibao Technology Class and Aon PLC 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 Aon PLC are associated (or correlated) with Zhibao Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhibao Technology Class has no effect on the direction of Aon PLC i.e., Aon PLC and Zhibao Technology go up and down completely randomly.
Pair Corralation between Aon PLC and Zhibao Technology
Considering the 90-day investment horizon Aon PLC is expected to generate 0.2 times more return on investment than Zhibao Technology. However, Aon PLC is 4.91 times less risky than Zhibao Technology. It trades about 0.21 of its potential returns per unit of risk. Zhibao Technology Class is currently generating about -0.02 per unit of risk. If you would invest 27,817 in Aon PLC on August 24, 2024 and sell it today you would earn a total of 10,445 from holding Aon PLC or generate 37.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aon PLC vs. Zhibao Technology Class
Performance |
| Timeline |
| Aon PLC |
| Zhibao Technology Class |
Aon PLC and Zhibao Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aon PLC and Zhibao Technology
The main advantage of trading using opposite Aon PLC and Zhibao Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aon PLC position performs unexpectedly, Zhibao Technology 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 Zhibao Technology will offset losses from the drop in Zhibao Technology's long position.| Aon PLC vs. Arthur J Gallagher | Aon PLC vs. Brown Brown | Aon PLC vs. Willis Towers Watson | Aon PLC vs. Erie Indemnity |
| Zhibao Technology vs. Kinetik Holdings | Zhibao Technology vs. Archrock | Zhibao Technology vs. Cardinal Health | Zhibao Technology vs. Tandem Diabetes Care |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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