Correlation Between China BlueChemical and AEON STORES
Can any of the company-specific risk be diversified away by investing in both China BlueChemical and AEON STORES 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 China BlueChemical and AEON STORES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China BlueChemical and AEON STORES, you can compare the effects of market volatilities on China BlueChemical and AEON STORES 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 China BlueChemical with a short position of AEON STORES. Check out your portfolio center. Please also check ongoing floating volatility patterns of China BlueChemical and AEON STORES.
Diversification Opportunities for China BlueChemical and AEON STORES
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between China and AEON is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding China BlueChemical and AEON STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEON STORES and China BlueChemical 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 China BlueChemical are associated (or correlated) with AEON STORES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEON STORES has no effect on the direction of China BlueChemical i.e., China BlueChemical and AEON STORES go up and down completely randomly.
Pair Corralation between China BlueChemical and AEON STORES
If you would invest 24.00 in China BlueChemical on September 13, 2024 and sell it today you would earn a total of 2.00 from holding China BlueChemical or generate 8.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China BlueChemical vs. AEON STORES
Performance |
| Timeline |
| China BlueChemical |
| AEON STORES |
China BlueChemical and AEON STORES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China BlueChemical and AEON STORES
The main advantage of trading using opposite China BlueChemical and AEON STORES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China BlueChemical position performs unexpectedly, AEON STORES 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 AEON STORES will offset losses from the drop in AEON STORES's long position.| China BlueChemical vs. Superior Plus Corp | China BlueChemical vs. SIVERS SEMICONDUCTORS AB | China BlueChemical vs. NorAm Drilling AS | China BlueChemical vs. Norsk Hydro ASA |
| AEON STORES vs. Apple Inc | AEON STORES vs. Apple Inc | AEON STORES vs. Apple Inc | AEON STORES vs. Apple Inc |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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