Correlation Between Dook Media and Anhui Huilong

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

Diversification Opportunities for Dook Media and Anhui Huilong

DookAnhuiDiversified AwayDookAnhuiDiversified Away100%
0.66
  Correlation Coefficient

Poor diversification

The 3 months correlation between Dook and Anhui is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Dook Media Group and Anhui Huilong Agricultural in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Huilong Agricu and Dook Media 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 Dook Media Group are associated (or correlated) with Anhui Huilong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Huilong Agricu has no effect on the direction of Dook Media i.e., Dook Media and Anhui Huilong go up and down completely randomly.

Pair Corralation between Dook Media and Anhui Huilong

Assuming the 90 days trading horizon Dook Media Group is expected to under-perform the Anhui Huilong. In addition to that, Dook Media is 1.06 times more volatile than Anhui Huilong Agricultural. It trades about -0.09 of its total potential returns per unit of risk. Anhui Huilong Agricultural is currently generating about 0.0 per unit of volatility. If you would invest  548.00  in Anhui Huilong Agricultural on October 26, 2024 and sell it today you would lose (12.00) from holding Anhui Huilong Agricultural or give up 2.19% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Dook Media Group  vs.  Anhui Huilong Agricultural

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -20-100102030
JavaScript chart by amCharts 3.21.15301025 002556
       Timeline  
Dook Media Group 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Dook Media Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan9101112
Anhui Huilong Agricu 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Weak
Over the last 90 days Anhui Huilong Agricultural has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Anhui Huilong is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan55.566.57

Dook Media and Anhui Huilong Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.31-3.98-2.65-1.310.02121.272.543.815.08 0.0320.0340.0360.0380.0400.0420.044
JavaScript chart by amCharts 3.21.15301025 002556
       Returns  

Pair Trading with Dook Media and Anhui Huilong

The main advantage of trading using opposite Dook Media and Anhui Huilong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dook Media position performs unexpectedly, Anhui Huilong 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 Huilong will offset losses from the drop in Anhui Huilong's long position.
The idea behind Dook Media Group and Anhui Huilong Agricultural 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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