Correlation Between AVIC Fund and Do Fluoride

Can any of the company-specific risk be diversified away by investing in both AVIC Fund and Do Fluoride 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 AVIC Fund and Do Fluoride into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AVIC Fund Management and Do Fluoride Chemicals Co, you can compare the effects of market volatilities on AVIC Fund and Do Fluoride 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 AVIC Fund with a short position of Do Fluoride. Check out your portfolio center. Please also check ongoing floating volatility patterns of AVIC Fund and Do Fluoride.

Diversification Opportunities for AVIC Fund and Do Fluoride

-0.03

Correlation Coefficient

AVIC Fund  Do Fluoride

Good diversification

The 3 months correlation between AVIC and 002407 is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding AVIC Fund Management and Do Fluoride Chemicals Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Do Fluoride Chemicals and AVIC Fund 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 AVIC Fund Management are associated (or correlated) with Do Fluoride. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Do Fluoride Chemicals has no effect on the direction of AVIC Fund i.e., AVIC Fund and Do Fluoride go up and down completely randomly.

Pair Corralation between AVIC Fund and Do Fluoride

Assuming the 90 days trading horizon AVIC Fund Management is expected to generate 0.55 times more return on investment than Do Fluoride. However, AVIC Fund Management is 1.83 times less risky than Do Fluoride. It trades about 0.27 of its potential returns per unit of risk. Do Fluoride Chemicals Co is currently generating about -0.03 per unit of risk. If you would invest  1,045  in AVIC Fund Management on December 25, 2024 and sell it today you would earn a total of  167.00  from holding AVIC Fund Management or generate 15.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

AVIC Fund Management  vs.  Do Fluoride Chemicals Co

AVIC Fund Management

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in AVIC Fund Management are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, AVIC Fund sustained solid returns over the last few months and may actually be approaching a breakup point.

Do Fluoride Chemicals

Risk-Adjusted Performance

Very Weak

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

Pair Trading with AVIC Fund and Do Fluoride

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

The idea behind AVIC Fund Management and Do Fluoride Chemicals Co 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.

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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.