Correlation Between ANT and Zhongfu Information

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

By analyzing existing cross correlation between ANT and Zhongfu Information, you can compare the effects of market volatilities on ANT and Zhongfu Information 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 ANT with a short position of Zhongfu Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANT and Zhongfu Information.

Diversification Opportunities for ANT and Zhongfu Information

-0.22

Correlation Coefficient

ANT  Zhongfu Information

Very good diversification

The 3 months correlation between ANT and Zhongfu is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding ANT and Zhongfu Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongfu Information and ANT 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 ANT are associated (or correlated) with Zhongfu Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongfu Information has no effect on the direction of ANT i.e., ANT and Zhongfu Information go up and down completely randomly.

Pair Corralation between ANT and Zhongfu Information

Assuming the 90 days trading horizon ANT is expected to generate 18.74 times more return on investment than Zhongfu Information. However, ANT is 18.74 times more volatile than Zhongfu Information. It trades about 0.14 of its potential returns per unit of risk. Zhongfu Information is currently generating about 0.07 per unit of risk. If you would invest  833.00  in ANT on October 26, 2024 and sell it today you would lose (686.00) from holding ANT or give up 82.35% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	94.53%
Values	Daily Returns

ANT  vs.  Zhongfu Information

ANT

Risk-Adjusted Performance

13 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ANT are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, ANT exhibited solid returns over the last few months and may actually be approaching a breakup point.

Zhongfu Information

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Zhongfu Information 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.

Pair Trading with ANT and Zhongfu Information

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

The idea behind ANT and Zhongfu Information 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.