Correlation Between Hunan Investment and China Asset
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By analyzing existing cross correlation between Hunan Investment Group and China Asset Management, you can compare the effects of market volatilities on Hunan Investment and China Asset 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 Hunan Investment with a short position of China Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunan Investment and China Asset.
Diversification Opportunities for Hunan Investment and China Asset
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hunan and China is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Hunan Investment Group and China Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Asset Management and Hunan Investment 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 Hunan Investment Group are associated (or correlated) with China Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Asset Management has no effect on the direction of Hunan Investment i.e., Hunan Investment and China Asset go up and down completely randomly.
Pair Corralation between Hunan Investment and China Asset
Assuming the 90 days trading horizon Hunan Investment is expected to generate 1.83 times less return on investment than China Asset. In addition to that, Hunan Investment is 3.02 times more volatile than China Asset Management. It trades about 0.03 of its total potential returns per unit of risk. China Asset Management is currently generating about 0.15 per unit of volatility. If you would invest 242.00 in China Asset Management on September 14, 2024 and sell it today you would earn a total of 99.00 from holding China Asset Management or generate 40.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hunan Investment Group vs. China Asset Management
Performance |
| Timeline |
| Hunan Investment |
| China Asset Management |
Hunan Investment and China Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hunan Investment and China Asset
The main advantage of trading using opposite Hunan Investment and China Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunan Investment position performs unexpectedly, China Asset 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 China Asset will offset losses from the drop in China Asset's long position.| Hunan Investment vs. Kweichow Moutai Co | Hunan Investment vs. Jiangsu Pacific Quartz | Hunan Investment vs. Shenzhen Transsion Holdings | Hunan Investment vs. Beijing Roborock Technology |
| China Asset vs. Kweichow Moutai Co | China Asset vs. Agricultural Bank of | China Asset vs. China Mobile Limited | China Asset vs. China Construction Bank |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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