Correlation Between China Securities and Highbroad Advanced
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By analyzing existing cross correlation between China Securities 800 and Highbroad Advanced Material, you can compare the effects of market volatilities on China Securities and Highbroad Advanced 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 China Securities with a short position of Highbroad Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Securities and Highbroad Advanced.
Diversification Opportunities for China Securities and Highbroad Advanced
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Highbroad is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding China Securities 800 and Highbroad Advanced Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Highbroad Advanced and China Securities 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 China Securities 800 are associated (or correlated) with Highbroad Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Highbroad Advanced has no effect on the direction of China Securities i.e., China Securities and Highbroad Advanced go up and down completely randomly.
Pair Corralation between China Securities and Highbroad Advanced
Assuming the 90 days trading horizon China Securities 800 is expected to generate 0.4 times more return on investment than Highbroad Advanced. However, China Securities 800 is 2.49 times less risky than Highbroad Advanced. It trades about -0.19 of its potential returns per unit of risk. Highbroad Advanced Material is currently generating about -0.1 per unit of risk. If you would invest 431,024 in China Securities 800 on October 31, 2024 and sell it today you would lose (20,384) from holding China Securities 800 or give up 4.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Securities 800 vs. Highbroad Advanced Material
Performance |
| Timeline |
China Securities and Highbroad Advanced Volatility Contrast
Predicted Return Density |
| Returns |
China Securities 800
Pair trading matchups for China Securities
Highbroad Advanced Material
Pair trading matchups for Highbroad Advanced
Pair Trading with China Securities and Highbroad Advanced
The main advantage of trading using opposite China Securities and Highbroad Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Securities position performs unexpectedly, Highbroad Advanced 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 Highbroad Advanced will offset losses from the drop in Highbroad Advanced's long position.| China Securities vs. Songz Automobile Air | China Securities vs. Qilu Bank Co | China Securities vs. Unisplendour Corp | China Securities vs. China Everbright Bank |
| Highbroad Advanced vs. Chengdu Kanghua Biological | Highbroad Advanced vs. Suzhou Novoprotein Scientific | Highbroad Advanced vs. Aluminum Corp of | Highbroad Advanced vs. COL Digital Publishing |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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