Correlation Between Financial Street and Hua Xia
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By analyzing existing cross correlation between Financial Street Holdings and Hua Xia Bank, you can compare the effects of market volatilities on Financial Street and Hua Xia 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 Financial Street with a short position of Hua Xia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Financial Street and Hua Xia.
Diversification Opportunities for Financial Street and Hua Xia
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Financial and Hua is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Financial Street Holdings and Hua Xia Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hua Xia Bank and Financial Street 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 Financial Street Holdings are associated (or correlated) with Hua Xia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hua Xia Bank has no effect on the direction of Financial Street i.e., Financial Street and Hua Xia go up and down completely randomly.
Pair Corralation between Financial Street and Hua Xia
Assuming the 90 days trading horizon Financial Street Holdings is expected to generate 2.18 times more return on investment than Hua Xia. However, Financial Street is 2.18 times more volatile than Hua Xia Bank. It trades about 0.05 of its potential returns per unit of risk. Hua Xia Bank is currently generating about 0.09 per unit of risk. If you would invest 258.00 in Financial Street Holdings on October 13, 2024 and sell it today you would earn a total of 42.00 from holding Financial Street Holdings or generate 16.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Financial Street Holdings vs. Hua Xia Bank
Performance |
| Timeline |
| Financial Street Holdings |
| Hua Xia Bank |
Financial Street and Hua Xia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Financial Street and Hua Xia
The main advantage of trading using opposite Financial Street and Hua Xia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Financial Street position performs unexpectedly, Hua Xia 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 Hua Xia will offset losses from the drop in Hua Xia's long position.| Financial Street vs. Changchun UP Optotech | Financial Street vs. HanS Laser Tech | Financial Street vs. Holitech Technology Co | Financial Street vs. Jinhe Biotechnology Co |
| Hua Xia vs. TongFu Microelectronics Co | Hua Xia vs. Shanghai Rightongene Biotechnology | Hua Xia vs. Maccura Biotechnology Co | Hua Xia vs. Jiangsu Jinling Sports |
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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