Correlation Between China Reform and Hainan Haiqi
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By analyzing existing cross correlation between China Reform Health and Hainan Haiqi Transportation, you can compare the effects of market volatilities on China Reform and Hainan Haiqi 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 China Reform with a short position of Hainan Haiqi. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Reform and Hainan Haiqi.
Diversification Opportunities for China Reform and Hainan Haiqi
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Hainan is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding China Reform Health and Hainan Haiqi Transportation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hainan Haiqi Transpo and China Reform 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 China Reform Health are associated (or correlated) with Hainan Haiqi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hainan Haiqi Transpo has no effect on the direction of China Reform i.e., China Reform and Hainan Haiqi go up and down completely randomly.
Pair Corralation between China Reform and Hainan Haiqi
Assuming the 90 days trading horizon China Reform Health is expected to under-perform the Hainan Haiqi. In addition to that, China Reform is 1.51 times more volatile than Hainan Haiqi Transportation. It trades about -0.14 of its total potential returns per unit of risk. Hainan Haiqi Transportation is currently generating about -0.03 per unit of volatility. If you would invest 1,968 in Hainan Haiqi Transportation on August 29, 2024 and sell it today you would lose (52.00) from holding Hainan Haiqi Transportation or give up 2.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Reform Health vs. Hainan Haiqi Transportation
Performance |
| Timeline |
| China Reform Health |
| Hainan Haiqi Transpo |
China Reform and Hainan Haiqi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Reform and Hainan Haiqi
The main advantage of trading using opposite China Reform and Hainan Haiqi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Reform position performs unexpectedly, Hainan Haiqi 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 Hainan Haiqi will offset losses from the drop in Hainan Haiqi's long position.| China Reform vs. Ming Yang Smart | China Reform vs. 159681 | China Reform vs. 159005 | China Reform vs. Loctek Ergonomic Technology |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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