Correlation Between Jointo Energy and Hua Xia
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By analyzing existing cross correlation between Jointo Energy Investment and Hua Xia Bank, you can compare the effects of market volatilities on Jointo Energy and Hua Xia 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 Jointo Energy with a short position of Hua Xia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jointo Energy and Hua Xia.
Diversification Opportunities for Jointo Energy and Hua Xia
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jointo and Hua is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Jointo Energy Investment and Hua Xia Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hua Xia Bank and Jointo Energy 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 Jointo Energy Investment are associated (or correlated) with Hua Xia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hua Xia Bank has no effect on the direction of Jointo Energy i.e., Jointo Energy and Hua Xia go up and down completely randomly.
Pair Corralation between Jointo Energy and Hua Xia
Assuming the 90 days trading horizon Jointo Energy Investment is expected to under-perform the Hua Xia. In addition to that, Jointo Energy is 2.56 times more volatile than Hua Xia Bank. It trades about -0.24 of its total potential returns per unit of risk. Hua Xia Bank is currently generating about -0.3 per unit of volatility. If you would invest 789.00 in Hua Xia Bank on October 25, 2024 and sell it today you would lose (55.00) from holding Hua Xia Bank or give up 6.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jointo Energy Investment vs. Hua Xia Bank
Performance |
| Timeline |
| Jointo Energy Investment |
| Hua Xia Bank |
Jointo Energy and Hua Xia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jointo Energy and Hua Xia
The main advantage of trading using opposite Jointo Energy and Hua Xia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jointo Energy position performs unexpectedly, Hua Xia 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 Hua Xia will offset losses from the drop in Hua Xia's long position.| Jointo Energy vs. Changchun BCHT Biotechnology | Jointo Energy vs. Pengxin International Mining | Jointo Energy vs. Shenyang Blue Silver | Jointo Energy vs. Western Mining Co |
| Hua Xia vs. Guangzhou Tinci Materials | Hua Xia vs. Nanjing Putian Telecommunications | Hua Xia vs. Ping An Insurance | Hua Xia vs. Wuhan Yangtze Communication |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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