Correlation Between Anhui Xinhua and Chongqing Sulian

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Anhui Xinhua and Chongqing Sulian 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 Xinhua and Chongqing Sulian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anhui Xinhua Media and Chongqing Sulian Plastic, you can compare the effects of market volatilities on Anhui Xinhua and Chongqing Sulian 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 Xinhua with a short position of Chongqing Sulian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Xinhua and Chongqing Sulian.

Diversification Opportunities for Anhui Xinhua and Chongqing Sulian

AnhuiChongqingDiversified AwayAnhuiChongqingDiversified Away100%
0.17
  Correlation Coefficient

Average diversification

The 3 months correlation between Anhui and Chongqing is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Xinhua Media and Chongqing Sulian Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Sulian Plastic and Anhui Xinhua 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 Xinhua Media are associated (or correlated) with Chongqing Sulian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Sulian Plastic has no effect on the direction of Anhui Xinhua i.e., Anhui Xinhua and Chongqing Sulian go up and down completely randomly.

Pair Corralation between Anhui Xinhua and Chongqing Sulian

Assuming the 90 days trading horizon Anhui Xinhua Media is expected to under-perform the Chongqing Sulian. But the stock apears to be less risky and, when comparing its historical volatility, Anhui Xinhua Media is 1.7 times less risky than Chongqing Sulian. The stock trades about -0.04 of its potential returns per unit of risk. The Chongqing Sulian Plastic is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  2,517  in Chongqing Sulian Plastic on October 31, 2024 and sell it today you would earn a total of  365.00  from holding Chongqing Sulian Plastic or generate 14.5% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Anhui Xinhua Media  vs.  Chongqing Sulian Plastic

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -50510152025
JavaScript chart by amCharts 3.21.15601801 301397
       Timeline  
Anhui Xinhua Media 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Anhui Xinhua Media 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.
JavaScript chart by amCharts 3.21.15DecJanJan6.577.58
Chongqing Sulian Plastic 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Chongqing Sulian Plastic are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Chongqing Sulian sustained solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanJan242628303234

Anhui Xinhua and Chongqing Sulian Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.54-3.4-2.26-1.12-0.01881.112.243.364.49 0.0200.0250.0300.0350.0400.0450.050
JavaScript chart by amCharts 3.21.15601801 301397
       Returns  

Pair Trading with Anhui Xinhua and Chongqing Sulian

The main advantage of trading using opposite Anhui Xinhua and Chongqing Sulian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Xinhua position performs unexpectedly, Chongqing Sulian 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 Chongqing Sulian will offset losses from the drop in Chongqing Sulian's long position.
The idea behind Anhui Xinhua Media and Chongqing Sulian Plastic 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..

Other Complementary Tools

Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Instant Ratings
Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance


 

Trending Assets