Correlation Between City Development and New Hope
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By analyzing existing cross correlation between City Development Environment and New Hope Dairy, you can compare the effects of market volatilities on City Development and New Hope 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 City Development with a short position of New Hope. Check out your portfolio center. Please also check ongoing floating volatility patterns of City Development and New Hope.
Diversification Opportunities for City Development and New Hope
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between City and New is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding City Development Environment and New Hope Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Hope Dairy and City Development 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 City Development Environment are associated (or correlated) with New Hope. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Hope Dairy has no effect on the direction of City Development i.e., City Development and New Hope go up and down completely randomly.
Pair Corralation between City Development and New Hope
Assuming the 90 days trading horizon City Development Environment is expected to generate 0.55 times more return on investment than New Hope. However, City Development Environment is 1.8 times less risky than New Hope. It trades about 0.09 of its potential returns per unit of risk. New Hope Dairy is currently generating about -0.27 per unit of risk. If you would invest 1,264 in City Development Environment on November 6, 2024 and sell it today you would earn a total of 19.00 from holding City Development Environment or generate 1.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
City Development Environment vs. New Hope Dairy
Performance |
| Timeline |
| City Development Env |
| New Hope Dairy |
City Development and New Hope Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with City Development and New Hope
The main advantage of trading using opposite City Development and New Hope positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if City Development position performs unexpectedly, New Hope 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 New Hope will offset losses from the drop in New Hope's long position.| City Development vs. Industrial Bank Co | City Development vs. Lecron Energy Saving | City Development vs. Financial Street Holdings | City Development vs. Guosheng Financial Holding |
| New Hope vs. Newcapec Electronics Co | New Hope vs. Sihui Fuji Electronics | New Hope vs. Xinya Electronic Co | New Hope vs. Weihai Honglin Electronic |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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