Correlation Between Haima Automobile and Liaoning Dingjide
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By analyzing existing cross correlation between Haima Automobile Group and Liaoning Dingjide Petrochemical, you can compare the effects of market volatilities on Haima Automobile and Liaoning Dingjide 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 Liaoning Dingjide. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haima Automobile and Liaoning Dingjide.
Diversification Opportunities for Haima Automobile and Liaoning Dingjide
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Haima and Liaoning is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Haima Automobile Group and Liaoning Dingjide Petrochemica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liaoning Dingjide 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 Liaoning Dingjide. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liaoning Dingjide has no effect on the direction of Haima Automobile i.e., Haima Automobile and Liaoning Dingjide go up and down completely randomly.
Pair Corralation between Haima Automobile and Liaoning Dingjide
Assuming the 90 days trading horizon Haima Automobile Group is expected to generate 1.27 times more return on investment than Liaoning Dingjide. However, Haima Automobile is 1.27 times more volatile than Liaoning Dingjide Petrochemical. It trades about 0.0 of its potential returns per unit of risk. Liaoning Dingjide Petrochemical is currently generating about -0.04 per unit of risk. If you would invest 517.00 in Haima Automobile Group on October 29, 2024 and sell it today you would lose (115.00) from holding Haima Automobile Group or give up 22.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haima Automobile Group vs. Liaoning Dingjide Petrochemica
Performance |
| Timeline |
| Haima Automobile |
| Liaoning Dingjide |
Haima Automobile and Liaoning Dingjide Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haima Automobile and Liaoning Dingjide
The main advantage of trading using opposite Haima Automobile and Liaoning Dingjide positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haima Automobile position performs unexpectedly, Liaoning Dingjide 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 Liaoning Dingjide will offset losses from the drop in Liaoning Dingjide's long position.| Haima Automobile vs. China Longyuan Power | Haima Automobile vs. PetroChina Co Ltd | Haima Automobile vs. Guangxi Guiguan Electric | Haima Automobile vs. Yantai North Andre |
| Liaoning Dingjide vs. Guangdong Wens Foodstuff | Liaoning Dingjide vs. Xinjiang Tianrun Dairy | Liaoning Dingjide vs. Shanghai Ziyan Foods | Liaoning Dingjide vs. Namchow Food Group |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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