Correlation Between Beijing Mainstreets and Hainan Drinda
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By analyzing existing cross correlation between Beijing Mainstreets Investment and Hainan Drinda Automotive, you can compare the effects of market volatilities on Beijing Mainstreets and Hainan Drinda 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 Beijing Mainstreets with a short position of Hainan Drinda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Mainstreets and Hainan Drinda.
Diversification Opportunities for Beijing Mainstreets and Hainan Drinda
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Beijing and Hainan is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Mainstreets Investment and Hainan Drinda Automotive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hainan Drinda Automotive and Beijing Mainstreets 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 Beijing Mainstreets Investment are associated (or correlated) with Hainan Drinda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hainan Drinda Automotive has no effect on the direction of Beijing Mainstreets i.e., Beijing Mainstreets and Hainan Drinda go up and down completely randomly.
Pair Corralation between Beijing Mainstreets and Hainan Drinda
Assuming the 90 days trading horizon Beijing Mainstreets Investment is expected to under-perform the Hainan Drinda. In addition to that, Beijing Mainstreets is 1.04 times more volatile than Hainan Drinda Automotive. It trades about -0.03 of its total potential returns per unit of risk. Hainan Drinda Automotive is currently generating about -0.02 per unit of volatility. If you would invest 12,676 in Hainan Drinda Automotive on September 14, 2024 and sell it today you would lose (6,381) from holding Hainan Drinda Automotive or give up 50.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Mainstreets Investment vs. Hainan Drinda Automotive
Performance |
| Timeline |
| Beijing Mainstreets |
| Hainan Drinda Automotive |
Beijing Mainstreets and Hainan Drinda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Mainstreets and Hainan Drinda
The main advantage of trading using opposite Beijing Mainstreets and Hainan Drinda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Mainstreets position performs unexpectedly, Hainan Drinda 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 Hainan Drinda will offset losses from the drop in Hainan Drinda's long position.| Beijing Mainstreets vs. China Life Insurance | Beijing Mainstreets vs. Cinda Securities Co | Beijing Mainstreets vs. Piotech Inc A | Beijing Mainstreets vs. Dongxing Sec Co |
| Hainan Drinda vs. Tieling Newcity Investment | Hainan Drinda vs. China Sports Industry | Hainan Drinda vs. Vanfund Urban Investment | Hainan Drinda vs. Beijing Mainstreets 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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