Correlation Between Huatian Hotel and Guangdong Jingyi
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By analyzing existing cross correlation between Huatian Hotel Group and Guangdong Jingyi Metal, you can compare the effects of market volatilities on Huatian Hotel and Guangdong Jingyi 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 Huatian Hotel with a short position of Guangdong Jingyi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huatian Hotel and Guangdong Jingyi.
Diversification Opportunities for Huatian Hotel and Guangdong Jingyi
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Huatian and Guangdong is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Huatian Hotel Group and Guangdong Jingyi Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Jingyi Metal and Huatian Hotel 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 Huatian Hotel Group are associated (or correlated) with Guangdong Jingyi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Jingyi Metal has no effect on the direction of Huatian Hotel i.e., Huatian Hotel and Guangdong Jingyi go up and down completely randomly.
Pair Corralation between Huatian Hotel and Guangdong Jingyi
Assuming the 90 days trading horizon Huatian Hotel Group is expected to generate 1.19 times more return on investment than Guangdong Jingyi. However, Huatian Hotel is 1.19 times more volatile than Guangdong Jingyi Metal. It trades about 0.07 of its potential returns per unit of risk. Guangdong Jingyi Metal is currently generating about -0.11 per unit of risk. If you would invest 303.00 in Huatian Hotel Group on December 1, 2024 and sell it today you would earn a total of 6.00 from holding Huatian Hotel Group or generate 1.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huatian Hotel Group vs. Guangdong Jingyi Metal
Performance |
| Timeline |
| Huatian Hotel Group |
| Guangdong Jingyi Metal |
Huatian Hotel and Guangdong Jingyi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huatian Hotel and Guangdong Jingyi
The main advantage of trading using opposite Huatian Hotel and Guangdong Jingyi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huatian Hotel position performs unexpectedly, Guangdong Jingyi 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 Guangdong Jingyi will offset losses from the drop in Guangdong Jingyi's long position.| Huatian Hotel vs. Porton Fine Chemicals | Huatian Hotel vs. Epoxy Base Electronic | Huatian Hotel vs. Goke Microelectronics Co | Huatian Hotel vs. Liaoning Dingjide Petrochemical |
| Guangdong Jingyi vs. Southern PublishingMedia Co | Guangdong Jingyi vs. Qtone Education Group | Guangdong Jingyi vs. Heilongjiang Publishing Media | Guangdong Jingyi vs. Jiangsu Yanghe Brewery |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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