Correlation Between Anhui Gujing and Lonkey Industrial
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By analyzing existing cross correlation between Anhui Gujing Distillery and Lonkey Industrial Co, you can compare the effects of market volatilities on Anhui Gujing and Lonkey Industrial 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 Gujing with a short position of Lonkey Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Gujing and Lonkey Industrial.
Diversification Opportunities for Anhui Gujing and Lonkey Industrial
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Anhui and Lonkey is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Gujing Distillery and Lonkey Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lonkey Industrial and Anhui Gujing 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 Gujing Distillery are associated (or correlated) with Lonkey Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lonkey Industrial has no effect on the direction of Anhui Gujing i.e., Anhui Gujing and Lonkey Industrial go up and down completely randomly.
Pair Corralation between Anhui Gujing and Lonkey Industrial
Assuming the 90 days trading horizon Anhui Gujing is expected to generate 1.29 times less return on investment than Lonkey Industrial. In addition to that, Anhui Gujing is 1.22 times more volatile than Lonkey Industrial Co. It trades about 0.08 of its total potential returns per unit of risk. Lonkey Industrial Co is currently generating about 0.12 per unit of volatility. If you would invest 265.00 in Lonkey Industrial Co on September 25, 2024 and sell it today you would earn a total of 61.00 from holding Lonkey Industrial Co or generate 23.02% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 98.33% |
Values | Daily Returns |
Anhui Gujing Distillery vs. Lonkey Industrial Co
Performance |
Timeline |
Anhui Gujing Distillery |
Lonkey Industrial |
Anhui Gujing and Lonkey Industrial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Anhui Gujing and Lonkey Industrial
The main advantage of trading using opposite Anhui Gujing and Lonkey Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Gujing position performs unexpectedly, Lonkey Industrial 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 Lonkey Industrial will offset losses from the drop in Lonkey Industrial's long position.Anhui Gujing vs. PetroChina Co Ltd | Anhui Gujing vs. China Mobile Limited | Anhui Gujing vs. CNOOC Limited | Anhui Gujing vs. Ping An Insurance |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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