Correlation Between Yuan Longping and Hubei Huaqiang
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By analyzing existing cross correlation between Yuan Longping High tech and Hubei Huaqiang High Tech, you can compare the effects of market volatilities on Yuan Longping and Hubei Huaqiang 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 Yuan Longping with a short position of Hubei Huaqiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuan Longping and Hubei Huaqiang.
Diversification Opportunities for Yuan Longping and Hubei Huaqiang
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Yuan and Hubei is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Yuan Longping High tech and Hubei Huaqiang High Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Huaqiang High and Yuan Longping 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 Yuan Longping High tech are associated (or correlated) with Hubei Huaqiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Huaqiang High has no effect on the direction of Yuan Longping i.e., Yuan Longping and Hubei Huaqiang go up and down completely randomly.
Pair Corralation between Yuan Longping and Hubei Huaqiang
Assuming the 90 days trading horizon Yuan Longping is expected to generate 1.85 times less return on investment than Hubei Huaqiang. In addition to that, Yuan Longping is 1.02 times more volatile than Hubei Huaqiang High Tech. It trades about 0.05 of its total potential returns per unit of risk. Hubei Huaqiang High Tech is currently generating about 0.09 per unit of volatility. If you would invest 1,625 in Hubei Huaqiang High Tech on September 3, 2024 and sell it today you would earn a total of 60.00 from holding Hubei Huaqiang High Tech or generate 3.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yuan Longping High tech vs. Hubei Huaqiang High Tech
Performance |
| Timeline |
| Yuan Longping High |
| Hubei Huaqiang High |
Yuan Longping and Hubei Huaqiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuan Longping and Hubei Huaqiang
The main advantage of trading using opposite Yuan Longping and Hubei Huaqiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuan Longping position performs unexpectedly, Hubei Huaqiang 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 Hubei Huaqiang will offset losses from the drop in Hubei Huaqiang's long position.| Yuan Longping vs. Beijing Wantai Biological | Yuan Longping vs. Aluminum Corp of | Yuan Longping vs. COL Digital Publishing | Yuan Longping vs. Shaanxi Meineng Clean |
| Hubei Huaqiang vs. Xinjiang Communications Construction | Hubei Huaqiang vs. Zhongtong Guomai Communication | Hubei Huaqiang vs. Zhejiang Publishing Media | Hubei Huaqiang vs. Northern United 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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