Correlation Between Wuhan Yangtze and Anhui Estone
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By analyzing existing cross correlation between Wuhan Yangtze Communication and Anhui Estone Materials, you can compare the effects of market volatilities on Wuhan Yangtze and Anhui Estone 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 Wuhan Yangtze with a short position of Anhui Estone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuhan Yangtze and Anhui Estone.
Diversification Opportunities for Wuhan Yangtze and Anhui Estone
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wuhan and Anhui is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Wuhan Yangtze Communication and Anhui Estone Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Estone Materials and Wuhan Yangtze 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 Wuhan Yangtze Communication are associated (or correlated) with Anhui Estone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Estone Materials has no effect on the direction of Wuhan Yangtze i.e., Wuhan Yangtze and Anhui Estone go up and down completely randomly.
Pair Corralation between Wuhan Yangtze and Anhui Estone
Assuming the 90 days trading horizon Wuhan Yangtze Communication is expected to generate 0.99 times more return on investment than Anhui Estone. However, Wuhan Yangtze Communication is 1.01 times less risky than Anhui Estone. It trades about 0.04 of its potential returns per unit of risk. Anhui Estone Materials is currently generating about -0.01 per unit of risk. If you would invest 1,986 in Wuhan Yangtze Communication on October 8, 2024 and sell it today you would earn a total of 117.00 from holding Wuhan Yangtze Communication or generate 5.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Wuhan Yangtze Communication vs. Anhui Estone Materials
Performance |
Timeline |
Wuhan Yangtze Commun |
Anhui Estone Materials |
Wuhan Yangtze and Anhui Estone Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Wuhan Yangtze and Anhui Estone
The main advantage of trading using opposite Wuhan Yangtze and Anhui Estone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuhan Yangtze position performs unexpectedly, Anhui Estone 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 Estone will offset losses from the drop in Anhui Estone's long position.Wuhan Yangtze vs. Kweichow Moutai Co | Wuhan Yangtze vs. NAURA Technology Group | Wuhan Yangtze vs. Zhejiang Orient Gene | Wuhan Yangtze vs. APT Medical |
Anhui Estone vs. China Asset Management | Anhui Estone vs. Eit Environmental Development | Anhui Estone vs. Sinocat Environmental Technology | Anhui Estone vs. Changjiang Jinggong Steel |
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 Stocks Directory module to find actively traded stocks across global markets.
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