Correlation Between Yili Chuanning and Dongguan Aohai
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By analyzing existing cross correlation between Yili Chuanning Biotechnology and Dongguan Aohai Technology, you can compare the effects of market volatilities on Yili Chuanning and Dongguan Aohai 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 Yili Chuanning with a short position of Dongguan Aohai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yili Chuanning and Dongguan Aohai.
Diversification Opportunities for Yili Chuanning and Dongguan Aohai
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Yili and Dongguan is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Yili Chuanning Biotechnology and Dongguan Aohai Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongguan Aohai Technology and Yili Chuanning 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 Yili Chuanning Biotechnology are associated (or correlated) with Dongguan Aohai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongguan Aohai Technology has no effect on the direction of Yili Chuanning i.e., Yili Chuanning and Dongguan Aohai go up and down completely randomly.
Pair Corralation between Yili Chuanning and Dongguan Aohai
Assuming the 90 days trading horizon Yili Chuanning Biotechnology is expected to under-perform the Dongguan Aohai. But the stock apears to be less risky and, when comparing its historical volatility, Yili Chuanning Biotechnology is 2.56 times less risky than Dongguan Aohai. The stock trades about -0.12 of its potential returns per unit of risk. The Dongguan Aohai Technology is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 3,299 in Dongguan Aohai Technology on September 26, 2024 and sell it today you would earn a total of 708.00 from holding Dongguan Aohai Technology or generate 21.46% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Yili Chuanning Biotechnology vs. Dongguan Aohai Technology
Performance |
Timeline |
Yili Chuanning Biote |
Dongguan Aohai Technology |
Yili Chuanning and Dongguan Aohai Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Yili Chuanning and Dongguan Aohai
The main advantage of trading using opposite Yili Chuanning and Dongguan Aohai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yili Chuanning position performs unexpectedly, Dongguan Aohai 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 Dongguan Aohai will offset losses from the drop in Dongguan Aohai's long position.Yili Chuanning vs. Industrial and Commercial | Yili Chuanning vs. Agricultural Bank of | Yili Chuanning vs. China Construction Bank | Yili Chuanning vs. Bank of China |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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