Correlation Between North Huajin and VT Industrial
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By analyzing existing cross correlation between North Huajin Chemical and VT Industrial Technology, you can compare the effects of market volatilities on North Huajin and VT 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 North Huajin with a short position of VT Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of North Huajin and VT Industrial.
Diversification Opportunities for North Huajin and VT Industrial
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between North and 300707 is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding North Huajin Chemical and VT Industrial Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VT Industrial Technology and North Huajin 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 North Huajin Chemical are associated (or correlated) with VT Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VT Industrial Technology has no effect on the direction of North Huajin i.e., North Huajin and VT Industrial go up and down completely randomly.
Pair Corralation between North Huajin and VT Industrial
Assuming the 90 days trading horizon North Huajin Chemical is expected to generate 0.9 times more return on investment than VT Industrial. However, North Huajin Chemical is 1.12 times less risky than VT Industrial. It trades about -0.03 of its potential returns per unit of risk. VT Industrial Technology is currently generating about -0.14 per unit of risk. If you would invest 544.00 in North Huajin Chemical on September 12, 2024 and sell it today you would lose (16.00) from holding North Huajin Chemical or give up 2.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
North Huajin Chemical vs. VT Industrial Technology
Performance |
| Timeline |
| North Huajin Chemical |
| VT Industrial Technology |
North Huajin and VT Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with North Huajin and VT Industrial
The main advantage of trading using opposite North Huajin and VT Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if North Huajin position performs unexpectedly, VT 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 VT Industrial will offset losses from the drop in VT Industrial's long position.| North Huajin vs. Zijin Mining Group | North Huajin vs. Wanhua Chemical Group | North Huajin vs. Baoshan Iron Steel | North Huajin vs. Rongsheng Petrochemical Co |
| VT Industrial vs. North Huajin Chemical | VT Industrial vs. Hubei Dinglong Chemical | VT Industrial vs. Xiangyang Automobile Bearing | VT Industrial vs. Dongfeng Automobile Co |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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