Correlation Between Huatian Hotel and Jiujiang Shanshui
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By analyzing existing cross correlation between Huatian Hotel Group and Jiujiang Shanshui Technology, you can compare the effects of market volatilities on Huatian Hotel and Jiujiang Shanshui 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 Jiujiang Shanshui. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huatian Hotel and Jiujiang Shanshui.
Diversification Opportunities for Huatian Hotel and Jiujiang Shanshui
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Huatian and Jiujiang is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Huatian Hotel Group and Jiujiang Shanshui Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiujiang Shanshui 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 Jiujiang Shanshui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiujiang Shanshui has no effect on the direction of Huatian Hotel i.e., Huatian Hotel and Jiujiang Shanshui go up and down completely randomly.
Pair Corralation between Huatian Hotel and Jiujiang Shanshui
Assuming the 90 days trading horizon Huatian Hotel Group is expected to under-perform the Jiujiang Shanshui. In addition to that, Huatian Hotel is 1.7 times more volatile than Jiujiang Shanshui Technology. It trades about -0.22 of its total potential returns per unit of risk. Jiujiang Shanshui Technology is currently generating about -0.2 per unit of volatility. If you would invest 1,605 in Jiujiang Shanshui Technology on October 18, 2024 and sell it today you would lose (123.00) from holding Jiujiang Shanshui Technology or give up 7.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huatian Hotel Group vs. Jiujiang Shanshui Technology
Performance |
| Timeline |
| Huatian Hotel Group |
| Jiujiang Shanshui |
Huatian Hotel and Jiujiang Shanshui Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huatian Hotel and Jiujiang Shanshui
The main advantage of trading using opposite Huatian Hotel and Jiujiang Shanshui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huatian Hotel position performs unexpectedly, Jiujiang Shanshui 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 Jiujiang Shanshui will offset losses from the drop in Jiujiang Shanshui's long position.| Huatian Hotel vs. Gem Year Industrial Co | Huatian Hotel vs. Xinjiang Baodi Mining | Huatian Hotel vs. Jonjee Hi tech Industrial | Huatian Hotel vs. Ningbo Fujia Industrial |
| Jiujiang Shanshui vs. Nanjing Putian Telecommunications | Jiujiang Shanshui vs. Time Publishing and | Jiujiang Shanshui vs. Xinhua Winshare Publishing | Jiujiang Shanshui vs. Ningbo Fangzheng Automobile |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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