Correlation Between Anhui Gujing and Shanghai Jin

Can any of the company-specific risk be diversified away by investing in both Anhui Gujing and Shanghai Jin 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 Gujing and Shanghai Jin into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Anhui Gujing Distillery and Shanghai Jin Jiang, you can compare the effects of market volatilities on Anhui Gujing and Shanghai Jin 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 Gujing with a short position of Shanghai Jin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Gujing and Shanghai Jin.

Diversification Opportunities for Anhui Gujing and Shanghai Jin

0.0

Correlation Coefficient

Anhui Gujing  Shanghai Jin

Pay attention - limited upside

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

Pair Corralation between Anhui Gujing and Shanghai Jin

If you would invest  0.00  in Shanghai Jin Jiang on October 21, 2024 and sell it today you would earn a total of  0.00  from holding Shanghai Jin Jiang or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.54%
Values	Daily Returns

Anhui Gujing Distillery  vs.  Shanghai Jin Jiang

Anhui Gujing Distillery

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Anhui Gujing Distillery has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Shanghai Jin Jiang

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Shanghai Jin Jiang has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Shanghai Jin is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Anhui Gujing and Shanghai Jin

The main advantage of trading using opposite Anhui Gujing and Shanghai Jin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Gujing position performs unexpectedly, Shanghai Jin 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 Shanghai Jin will offset losses from the drop in Shanghai Jin's long position.

The idea behind Anhui Gujing Distillery and Shanghai Jin Jiang 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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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.