Correlation Between Hengli Industrial and Hangzhou Huawang
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By analyzing existing cross correlation between Hengli Industrial Development and Hangzhou Huawang New, you can compare the effects of market volatilities on Hengli Industrial and Hangzhou Huawang 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 Hengli Industrial with a short position of Hangzhou Huawang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hengli Industrial and Hangzhou Huawang.
Diversification Opportunities for Hengli Industrial and Hangzhou Huawang
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hengli and Hangzhou is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Hengli Industrial Development and Hangzhou Huawang New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hangzhou Huawang New and Hengli Industrial 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 Hengli Industrial Development are associated (or correlated) with Hangzhou Huawang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hangzhou Huawang New has no effect on the direction of Hengli Industrial i.e., Hengli Industrial and Hangzhou Huawang go up and down completely randomly.
Pair Corralation between Hengli Industrial and Hangzhou Huawang
Assuming the 90 days trading horizon Hengli Industrial Development is expected to generate 1.85 times more return on investment than Hangzhou Huawang. However, Hengli Industrial is 1.85 times more volatile than Hangzhou Huawang New. It trades about 0.28 of its potential returns per unit of risk. Hangzhou Huawang New is currently generating about -0.14 per unit of risk. If you would invest 187.00 in Hengli Industrial Development on August 29, 2024 and sell it today you would earn a total of 53.00 from holding Hengli Industrial Development or generate 28.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hengli Industrial Development vs. Hangzhou Huawang New
Performance |
| Timeline |
| Hengli Industrial |
| Hangzhou Huawang New |
Hengli Industrial and Hangzhou Huawang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hengli Industrial and Hangzhou Huawang
The main advantage of trading using opposite Hengli Industrial and Hangzhou Huawang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hengli Industrial position performs unexpectedly, Hangzhou Huawang 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 Hangzhou Huawang will offset losses from the drop in Hangzhou Huawang's long position.| Hengli Industrial vs. Huaxia Fund Management | Hengli Industrial vs. Cicc Fund Management | Hengli Industrial vs. AVIC Fund Management | Hengli Industrial vs. Hangzhou Pinming Software |
| Hangzhou Huawang vs. Qinghaihuading Industrial Co | Hangzhou Huawang vs. Hengli Industrial Development | Hangzhou Huawang vs. Gem Year Industrial Co | Hangzhou Huawang vs. Guangdong Jingyi Metal |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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