Correlation Between Ganfeng Lithium and Asahi Kasei
Can any of the company-specific risk be diversified away by investing in both Ganfeng Lithium and Asahi Kasei 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 Ganfeng Lithium and Asahi Kasei into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ganfeng Lithium Co and Asahi Kasei, you can compare the effects of market volatilities on Ganfeng Lithium and Asahi Kasei 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 Ganfeng Lithium with a short position of Asahi Kasei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ganfeng Lithium and Asahi Kasei.
Diversification Opportunities for Ganfeng Lithium and Asahi Kasei
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ganfeng and Asahi is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Ganfeng Lithium Co and Asahi Kasei in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asahi Kasei and Ganfeng Lithium 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 Ganfeng Lithium Co are associated (or correlated) with Asahi Kasei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asahi Kasei has no effect on the direction of Ganfeng Lithium i.e., Ganfeng Lithium and Asahi Kasei go up and down completely randomly.
Pair Corralation between Ganfeng Lithium and Asahi Kasei
Assuming the 90 days horizon Ganfeng Lithium Co is expected to generate 2.39 times more return on investment than Asahi Kasei. However, Ganfeng Lithium is 2.39 times more volatile than Asahi Kasei. It trades about 0.03 of its potential returns per unit of risk. Asahi Kasei is currently generating about 0.05 per unit of risk. If you would invest 245.00 in Ganfeng Lithium Co on November 3, 2024 and sell it today you would earn a total of 3.00 from holding Ganfeng Lithium Co or generate 1.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 54.0% |
| Values | Daily Returns |
Ganfeng Lithium Co vs. Asahi Kasei
Performance |
| Timeline |
| Ganfeng Lithium |
| Asahi Kasei |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ganfeng Lithium and Asahi Kasei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ganfeng Lithium and Asahi Kasei
The main advantage of trading using opposite Ganfeng Lithium and Asahi Kasei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ganfeng Lithium position performs unexpectedly, Asahi Kasei 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 Asahi Kasei will offset losses from the drop in Asahi Kasei's long position.| Ganfeng Lithium vs. BioLargo | Ganfeng Lithium vs. Shin Etsu Chemical Co | Ganfeng Lithium vs. Lsb Industries | Ganfeng Lithium vs. Braskem SA Class |
| Asahi Kasei vs. Altech Batteries Limited | Asahi Kasei vs. Alumifuel Pwr Corp | Asahi Kasei vs. Shin Etsu Chemical Co | Asahi Kasei vs. ASP Isotopes Common |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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