Correlation Between Beijing Mainstreets and Hubei Xingfa
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By analyzing existing cross correlation between Beijing Mainstreets Investment and Hubei Xingfa Chemicals, you can compare the effects of market volatilities on Beijing Mainstreets and Hubei Xingfa 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 Hubei Xingfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Mainstreets and Hubei Xingfa.
Diversification Opportunities for Beijing Mainstreets and Hubei Xingfa
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Beijing and Hubei is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Mainstreets Investment and Hubei Xingfa Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Xingfa Chemicals 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 Hubei Xingfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Xingfa Chemicals has no effect on the direction of Beijing Mainstreets i.e., Beijing Mainstreets and Hubei Xingfa go up and down completely randomly.
Pair Corralation between Beijing Mainstreets and Hubei Xingfa
Assuming the 90 days trading horizon Beijing Mainstreets Investment is expected to under-perform the Hubei Xingfa. In addition to that, Beijing Mainstreets is 1.89 times more volatile than Hubei Xingfa Chemicals. It trades about -0.02 of its total potential returns per unit of risk. Hubei Xingfa Chemicals is currently generating about -0.02 per unit of volatility. If you would invest 3,027 in Hubei Xingfa Chemicals on October 11, 2024 and sell it today you would lose (905.00) from holding Hubei Xingfa Chemicals or give up 29.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Mainstreets Investment vs. Hubei Xingfa Chemicals
Performance |
| Timeline |
| Beijing Mainstreets |
| Hubei Xingfa Chemicals |
Beijing Mainstreets and Hubei Xingfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Mainstreets and Hubei Xingfa
The main advantage of trading using opposite Beijing Mainstreets and Hubei Xingfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Mainstreets position performs unexpectedly, Hubei Xingfa 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 Hubei Xingfa will offset losses from the drop in Hubei Xingfa's long position.| Beijing Mainstreets vs. Quectel Wireless Solutions | Beijing Mainstreets vs. Xiangyang Automobile Bearing | Beijing Mainstreets vs. SUNSEA Telecommunications Co | Beijing Mainstreets vs. China Mobile Limited |
| Hubei Xingfa vs. Air China Ltd | Hubei Xingfa vs. Beijing Mainstreets Investment | Hubei Xingfa vs. Zoy Home Furnishing | Hubei Xingfa vs. Kunwu Jiuding 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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