Correlation Between Yantai Moon and Hengdian Entertainment
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By analyzing existing cross correlation between Yantai Moon Co and Hengdian Entertainment Co, you can compare the effects of market volatilities on Yantai Moon and Hengdian Entertainment 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 Yantai Moon with a short position of Hengdian Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yantai Moon and Hengdian Entertainment.
Diversification Opportunities for Yantai Moon and Hengdian Entertainment
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Yantai and Hengdian is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Yantai Moon Co and Hengdian Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hengdian Entertainment and Yantai Moon 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 Yantai Moon Co are associated (or correlated) with Hengdian Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hengdian Entertainment has no effect on the direction of Yantai Moon i.e., Yantai Moon and Hengdian Entertainment go up and down completely randomly.
Pair Corralation between Yantai Moon and Hengdian Entertainment
Assuming the 90 days trading horizon Yantai Moon Co is expected to under-perform the Hengdian Entertainment. But the stock apears to be less risky and, when comparing its historical volatility, Yantai Moon Co is 1.21 times less risky than Hengdian Entertainment. The stock trades about -0.03 of its potential returns per unit of risk. The Hengdian Entertainment Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,710 in Hengdian Entertainment Co on September 12, 2024 and sell it today you would lose (125.00) from holding Hengdian Entertainment Co or give up 7.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yantai Moon Co vs. Hengdian Entertainment Co
Performance |
| Timeline |
| Yantai Moon |
| Hengdian Entertainment |
Yantai Moon and Hengdian Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yantai Moon and Hengdian Entertainment
The main advantage of trading using opposite Yantai Moon and Hengdian Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yantai Moon position performs unexpectedly, Hengdian Entertainment 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 Hengdian Entertainment will offset losses from the drop in Hengdian Entertainment's long position.| Yantai Moon vs. Peoples Insurance of | Yantai Moon vs. Lonkey Industrial Co | Yantai Moon vs. Guangzhou Dongfang Hotel | Yantai Moon vs. Hengli Industrial Development |
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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