Correlation Between Weichai Heavy and Dongrui Food
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By analyzing existing cross correlation between Weichai Heavy Machinery and Dongrui Food Group, you can compare the effects of market volatilities on Weichai Heavy and Dongrui Food 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 Weichai Heavy with a short position of Dongrui Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weichai Heavy and Dongrui Food.
Diversification Opportunities for Weichai Heavy and Dongrui Food
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Weichai and Dongrui is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding Weichai Heavy Machinery and Dongrui Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongrui Food Group and Weichai Heavy 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 Weichai Heavy Machinery are associated (or correlated) with Dongrui Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongrui Food Group has no effect on the direction of Weichai Heavy i.e., Weichai Heavy and Dongrui Food go up and down completely randomly.
Pair Corralation between Weichai Heavy and Dongrui Food
Assuming the 90 days trading horizon Weichai Heavy Machinery is expected to generate 3.03 times more return on investment than Dongrui Food. However, Weichai Heavy is 3.03 times more volatile than Dongrui Food Group. It trades about 0.34 of its potential returns per unit of risk. Dongrui Food Group is currently generating about -0.12 per unit of risk. If you would invest 1,531 in Weichai Heavy Machinery on October 25, 2024 and sell it today you would earn a total of 692.00 from holding Weichai Heavy Machinery or generate 45.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weichai Heavy Machinery vs. Dongrui Food Group
Performance |
| Timeline |
| Weichai Heavy Machinery |
| Dongrui Food Group |
Weichai Heavy and Dongrui Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weichai Heavy and Dongrui Food
The main advantage of trading using opposite Weichai Heavy and Dongrui Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weichai Heavy position performs unexpectedly, Dongrui Food 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 Dongrui Food will offset losses from the drop in Dongrui Food's long position.| Weichai Heavy vs. Kweichow Moutai Co | Weichai Heavy vs. Contemporary Amperex Technology | Weichai Heavy vs. Beijing Roborock Technology | Weichai Heavy vs. BYD Co Ltd |
| Dongrui Food vs. Agricultural Bank of | Dongrui Food vs. Postal Savings Bank | Dongrui Food vs. Bank of Communications | Dongrui Food vs. China Merchants Bank |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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