Correlation Between Hunan Valin and Tieling Newcity
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By analyzing existing cross correlation between Hunan Valin Steel and Tieling Newcity Investment, you can compare the effects of market volatilities on Hunan Valin and Tieling Newcity 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 Hunan Valin with a short position of Tieling Newcity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunan Valin and Tieling Newcity.
Diversification Opportunities for Hunan Valin and Tieling Newcity
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hunan and Tieling is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Hunan Valin Steel and Tieling Newcity Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tieling Newcity Inve and Hunan Valin 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 Hunan Valin Steel are associated (or correlated) with Tieling Newcity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tieling Newcity Inve has no effect on the direction of Hunan Valin i.e., Hunan Valin and Tieling Newcity go up and down completely randomly.
Pair Corralation between Hunan Valin and Tieling Newcity
Assuming the 90 days trading horizon Hunan Valin is expected to generate 5.09 times less return on investment than Tieling Newcity. But when comparing it to its historical volatility, Hunan Valin Steel is 1.21 times less risky than Tieling Newcity. It trades about 0.06 of its potential returns per unit of risk. Tieling Newcity Investment is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 268.00 in Tieling Newcity Investment on September 13, 2024 and sell it today you would earn a total of 33.00 from holding Tieling Newcity Investment or generate 12.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Hunan Valin Steel vs. Tieling Newcity Investment
Performance |
| Timeline |
| Hunan Valin Steel |
| Tieling Newcity Inve |
Hunan Valin and Tieling Newcity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hunan Valin and Tieling Newcity
The main advantage of trading using opposite Hunan Valin and Tieling Newcity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunan Valin position performs unexpectedly, Tieling Newcity 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 Tieling Newcity will offset losses from the drop in Tieling Newcity's long position.| Hunan Valin vs. Shanghai Shuixing Home | Hunan Valin vs. Quectel Wireless Solutions | Hunan Valin vs. Shenzhen Topway Video | Hunan Valin vs. Mengtian Home Group |
| Tieling Newcity vs. PetroChina Co Ltd | Tieling Newcity vs. China Mobile Limited | Tieling Newcity vs. CNOOC Limited | Tieling Newcity vs. Ping An Insurance |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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