Correlation Between Haima Automobile and Montage Technology
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By analyzing existing cross correlation between Haima Automobile Group and Montage Technology Co, you can compare the effects of market volatilities on Haima Automobile and Montage Technology 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 Montage Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haima Automobile and Montage Technology.
Diversification Opportunities for Haima Automobile and Montage Technology
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Haima and Montage is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Haima Automobile Group and Montage Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Montage Technology 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 Montage Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Montage Technology has no effect on the direction of Haima Automobile i.e., Haima Automobile and Montage Technology go up and down completely randomly.
Pair Corralation between Haima Automobile and Montage Technology
Assuming the 90 days trading horizon Haima Automobile is expected to generate 2.56 times less return on investment than Montage Technology. But when comparing it to its historical volatility, Haima Automobile Group is 1.16 times less risky than Montage Technology. It trades about 0.07 of its potential returns per unit of risk. Montage Technology Co is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 6,391 in Montage Technology Co on November 7, 2024 and sell it today you would earn a total of 413.00 from holding Montage Technology Co or generate 6.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haima Automobile Group vs. Montage Technology Co
Performance |
| Timeline |
| Haima Automobile |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Montage Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Haima Automobile and Montage Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haima Automobile and Montage Technology
The main advantage of trading using opposite Haima Automobile and Montage Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haima Automobile position performs unexpectedly, Montage Technology 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 Montage Technology will offset losses from the drop in Montage Technology's long position.The idea behind Haima Automobile Group and Montage Technology Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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