Correlation Between AOI Electronics and ZhongAn Online

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Can any of the company-specific risk be diversified away by investing in both AOI Electronics and ZhongAn Online 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 AOI Electronics and ZhongAn Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AOI Electronics Co and ZhongAn Online P, you can compare the effects of market volatilities on AOI Electronics and ZhongAn Online 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 AOI Electronics with a short position of ZhongAn Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of AOI Electronics and ZhongAn Online.

Diversification Opportunities for AOI Electronics and ZhongAn Online

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  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between AOI and ZhongAn is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AOI Electronics Co and ZhongAn Online P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZhongAn Online P and AOI Electronics 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 AOI Electronics Co are associated (or correlated) with ZhongAn Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZhongAn Online P has no effect on the direction of AOI Electronics i.e., AOI Electronics and ZhongAn Online go up and down completely randomly.

Pair Corralation between AOI Electronics and ZhongAn Online

If you would invest  1,868  in AOI Electronics Co on October 11, 2024 and sell it today you would earn a total of  0.00  from holding AOI Electronics Co or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy94.44%
ValuesDaily Returns

AOI Electronics Co  vs.  ZhongAn Online P

 Performance 
       Timeline  
AOI Electronics 

Risk-Adjusted Performance

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Over the last 90 days AOI Electronics Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, AOI Electronics is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.
ZhongAn Online P 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days ZhongAn Online P has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

AOI Electronics and ZhongAn Online Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with AOI Electronics and ZhongAn Online

The main advantage of trading using opposite AOI Electronics and ZhongAn Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AOI Electronics position performs unexpectedly, ZhongAn Online 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 ZhongAn Online will offset losses from the drop in ZhongAn Online's long position.
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The idea behind AOI Electronics Co and ZhongAn Online P pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.

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