Correlation Between Huagong Tech and Wuhan Yangtze
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By analyzing existing cross correlation between Huagong Tech Co and Wuhan Yangtze Communication, you can compare the effects of market volatilities on Huagong Tech and Wuhan Yangtze 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 Huagong Tech with a short position of Wuhan Yangtze. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huagong Tech and Wuhan Yangtze.
Diversification Opportunities for Huagong Tech and Wuhan Yangtze
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Huagong and Wuhan is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Huagong Tech Co and Wuhan Yangtze Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wuhan Yangtze Commun and Huagong Tech 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 Huagong Tech Co are associated (or correlated) with Wuhan Yangtze. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wuhan Yangtze Commun has no effect on the direction of Huagong Tech i.e., Huagong Tech and Wuhan Yangtze go up and down completely randomly.
Pair Corralation between Huagong Tech and Wuhan Yangtze
Assuming the 90 days trading horizon Huagong Tech Co is expected to under-perform the Wuhan Yangtze. But the stock apears to be less risky and, when comparing its historical volatility, Huagong Tech Co is 1.11 times less risky than Wuhan Yangtze. The stock trades about -0.18 of its potential returns per unit of risk. The Wuhan Yangtze Communication is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 2,391 in Wuhan Yangtze Communication on October 31, 2024 and sell it today you would lose (98.00) from holding Wuhan Yangtze Communication or give up 4.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huagong Tech Co vs. Wuhan Yangtze Communication
Performance |
| Timeline |
| Huagong Tech |
| Wuhan Yangtze Commun |
Huagong Tech and Wuhan Yangtze Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huagong Tech and Wuhan Yangtze
The main advantage of trading using opposite Huagong Tech and Wuhan Yangtze positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huagong Tech position performs unexpectedly, Wuhan Yangtze 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 Wuhan Yangtze will offset losses from the drop in Wuhan Yangtze's long position.| Huagong Tech vs. Dazhong Transportation Group | Huagong Tech vs. Changjiang Publishing Media | Huagong Tech vs. Chengdu B ray Media | Huagong Tech vs. Omnijoi Media Corp |
| Wuhan Yangtze vs. Jiaozuo Wanfang Aluminum | Wuhan Yangtze vs. Nanjing Putian Telecommunications | Wuhan Yangtze vs. Sino Platinum Metals Co | Wuhan Yangtze vs. Jilin Jlu Communication |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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