Correlation Between Haima Automobile and Shanghai Broadband
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By analyzing existing cross correlation between Haima Automobile Group and Shanghai Broadband Technology, you can compare the effects of market volatilities on Haima Automobile and Shanghai Broadband 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 Shanghai Broadband. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haima Automobile and Shanghai Broadband.
Diversification Opportunities for Haima Automobile and Shanghai Broadband
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Haima and Shanghai is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Haima Automobile Group and Shanghai Broadband Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Broadband 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 Shanghai Broadband. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Broadband has no effect on the direction of Haima Automobile i.e., Haima Automobile and Shanghai Broadband go up and down completely randomly.
Pair Corralation between Haima Automobile and Shanghai Broadband
Assuming the 90 days trading horizon Haima Automobile is expected to generate 1.46 times less return on investment than Shanghai Broadband. In addition to that, Haima Automobile is 2.59 times more volatile than Shanghai Broadband Technology. It trades about 0.12 of its total potential returns per unit of risk. Shanghai Broadband Technology is currently generating about 0.46 per unit of volatility. If you would invest 328.00 in Shanghai Broadband Technology on August 27, 2024 and sell it today you would earn a total of 87.00 from holding Shanghai Broadband Technology or generate 26.52% 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. Shanghai Broadband Technology
Performance |
| Timeline |
| Haima Automobile |
| Shanghai Broadband |
Haima Automobile and Shanghai Broadband Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haima Automobile and Shanghai Broadband
The main advantage of trading using opposite Haima Automobile and Shanghai Broadband positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haima Automobile position performs unexpectedly, Shanghai Broadband 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 Shanghai Broadband will offset losses from the drop in Shanghai Broadband's long position.| Haima Automobile vs. Xiangyang Automobile Bearing | Haima Automobile vs. Northking Information Technology | Haima Automobile vs. Changzhou Evergreen Technology | Haima Automobile vs. Jiangsu Xinri E Vehicle |
| Shanghai Broadband vs. Zijin Mining Group | Shanghai Broadband vs. Wanhua Chemical Group | Shanghai Broadband vs. Baoshan Iron Steel | Shanghai Broadband vs. Shandong Gold Mining |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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