Correlation Between Anhui Conch and Eagle Materials
Can any of the company-specific risk be diversified away by investing in both Anhui Conch and Eagle Materials 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 Anhui Conch and Eagle Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anhui Conch Cement and Eagle Materials, you can compare the effects of market volatilities on Anhui Conch and Eagle Materials 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 Anhui Conch with a short position of Eagle Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Conch and Eagle Materials.
Diversification Opportunities for Anhui Conch and Eagle Materials
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Anhui and Eagle is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Conch Cement and Eagle Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Materials and Anhui Conch 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 Anhui Conch Cement are associated (or correlated) with Eagle Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Materials has no effect on the direction of Anhui Conch i.e., Anhui Conch and Eagle Materials go up and down completely randomly.
Pair Corralation between Anhui Conch and Eagle Materials
Assuming the 90 days horizon Anhui Conch Cement is expected to generate 2.21 times more return on investment than Eagle Materials. However, Anhui Conch is 2.21 times more volatile than Eagle Materials. It trades about 0.11 of its potential returns per unit of risk. Eagle Materials is currently generating about 0.21 per unit of risk. If you would invest 186.00 in Anhui Conch Cement on August 29, 2024 and sell it today you would earn a total of 56.00 from holding Anhui Conch Cement or generate 30.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.46% |
| Values | Daily Returns |
Anhui Conch Cement vs. Eagle Materials
Performance |
| Timeline |
| Anhui Conch Cement |
| Eagle Materials |
Anhui Conch and Eagle Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Conch and Eagle Materials
The main advantage of trading using opposite Anhui Conch and Eagle Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Conch position performs unexpectedly, Eagle Materials 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 Eagle Materials will offset losses from the drop in Eagle Materials' long position.| Anhui Conch vs. MHP Hotel AG | Anhui Conch vs. COVIVIO HOTELS INH | Anhui Conch vs. Cogent Communications Holdings | Anhui Conch vs. HYATT HOTELS A |
| Eagle Materials vs. Daikin IndustriesLtd | Eagle Materials vs. Vulcan Materials | Eagle Materials vs. Anhui Conch Cement | Eagle Materials vs. Superior Plus Corp |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |