Correlation Between Haima Automobile and Fujian Longzhou
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By analyzing existing cross correlation between Haima Automobile Group and Fujian Longzhou Transportation, you can compare the effects of market volatilities on Haima Automobile and Fujian Longzhou 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 Haima Automobile with a short position of Fujian Longzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haima Automobile and Fujian Longzhou.
Diversification Opportunities for Haima Automobile and Fujian Longzhou
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Haima and Fujian is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Haima Automobile Group and Fujian Longzhou Transportation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Longzhou Tran and Haima Automobile 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 Haima Automobile Group are associated (or correlated) with Fujian Longzhou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Longzhou Tran has no effect on the direction of Haima Automobile i.e., Haima Automobile and Fujian Longzhou go up and down completely randomly.
Pair Corralation between Haima Automobile and Fujian Longzhou
Assuming the 90 days trading horizon Haima Automobile Group is expected to under-perform the Fujian Longzhou. In addition to that, Haima Automobile is 1.16 times more volatile than Fujian Longzhou Transportation. It trades about -0.12 of its total potential returns per unit of risk. Fujian Longzhou Transportation is currently generating about 0.21 per unit of volatility. If you would invest 443.00 in Fujian Longzhou Transportation on September 1, 2024 and sell it today you would earn a total of 89.00 from holding Fujian Longzhou Transportation or generate 20.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haima Automobile Group vs. Fujian Longzhou Transportation
Performance |
| Timeline |
| Haima Automobile |
| Fujian Longzhou Tran |
Haima Automobile and Fujian Longzhou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haima Automobile and Fujian Longzhou
The main advantage of trading using opposite Haima Automobile and Fujian Longzhou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haima Automobile position performs unexpectedly, Fujian Longzhou 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 Fujian Longzhou will offset losses from the drop in Fujian Longzhou's long position.| Haima Automobile vs. Biwin Storage Technology | Haima Automobile vs. PetroChina Co Ltd | Haima Automobile vs. Industrial and Commercial | Haima Automobile vs. China Construction Bank |
| Fujian Longzhou vs. Agricultural Bank of | Fujian Longzhou vs. Industrial and Commercial | Fujian Longzhou vs. Bank of China | Fujian Longzhou 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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