Correlation Between CEMEX SAB and Anhui Conch
Can any of the company-specific risk be diversified away by investing in both CEMEX SAB and Anhui Conch 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 CEMEX SAB and Anhui Conch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CEMEX SAB de and Anhui Conch Cement, you can compare the effects of market volatilities on CEMEX SAB and Anhui Conch 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 CEMEX SAB with a short position of Anhui Conch. Check out your portfolio center. Please also check ongoing floating volatility patterns of CEMEX SAB and Anhui Conch.
Diversification Opportunities for CEMEX SAB and Anhui Conch
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CEMEX and Anhui is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding CEMEX SAB de and Anhui Conch Cement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Conch Cement and CEMEX SAB 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 CEMEX SAB de are associated (or correlated) with Anhui Conch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Conch Cement has no effect on the direction of CEMEX SAB i.e., CEMEX SAB and Anhui Conch go up and down completely randomly.
Pair Corralation between CEMEX SAB and Anhui Conch
Assuming the 90 days horizon CEMEX SAB de is expected to under-perform the Anhui Conch. But the pink sheet apears to be less risky and, when comparing its historical volatility, CEMEX SAB de is 1.05 times less risky than Anhui Conch. The pink sheet trades about 0.0 of its potential returns per unit of risk. The Anhui Conch Cement is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 194.00 in Anhui Conch Cement on November 5, 2024 and sell it today you would earn a total of 74.00 from holding Anhui Conch Cement or generate 38.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.68% |
| Values | Daily Returns |
CEMEX SAB de vs. Anhui Conch Cement
Performance |
| Timeline |
| CEMEX SAB de |
| Anhui Conch Cement |
CEMEX SAB and Anhui Conch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CEMEX SAB and Anhui Conch
The main advantage of trading using opposite CEMEX SAB and Anhui Conch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEMEX SAB position performs unexpectedly, Anhui Conch 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 Anhui Conch will offset losses from the drop in Anhui Conch's long position.| CEMEX SAB vs. Vulcan Materials | CEMEX SAB vs. Martin Marietta Materials | CEMEX SAB vs. Eagle Materials | CEMEX SAB vs. CRH PLC ADR |
| Anhui Conch vs. Xinyi Glass Holdings | Anhui Conch vs. PT Berkah Beton | Anhui Conch vs. Taiga Building Products | Anhui Conch vs. Xinyi Glass Holdings |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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