Correlation Between Qingdao Foods and Hainan Haiqi
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By analyzing existing cross correlation between Qingdao Foods Co and Hainan Haiqi Transportation, you can compare the effects of market volatilities on Qingdao Foods and Hainan Haiqi 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 Qingdao Foods with a short position of Hainan Haiqi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qingdao Foods and Hainan Haiqi.
Diversification Opportunities for Qingdao Foods and Hainan Haiqi
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Qingdao and Hainan is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Qingdao Foods Co and Hainan Haiqi Transportation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hainan Haiqi Transpo and Qingdao Foods 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 Qingdao Foods Co are associated (or correlated) with Hainan Haiqi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hainan Haiqi Transpo has no effect on the direction of Qingdao Foods i.e., Qingdao Foods and Hainan Haiqi go up and down completely randomly.
Pair Corralation between Qingdao Foods and Hainan Haiqi
Assuming the 90 days trading horizon Qingdao Foods is expected to generate 7.33 times less return on investment than Hainan Haiqi. But when comparing it to its historical volatility, Qingdao Foods Co is 1.94 times less risky than Hainan Haiqi. It trades about 0.02 of its potential returns per unit of risk. Hainan Haiqi Transportation is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,707 in Hainan Haiqi Transportation on November 4, 2024 and sell it today you would earn a total of 50.00 from holding Hainan Haiqi Transportation or generate 2.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qingdao Foods Co vs. Hainan Haiqi Transportation
Performance |
| Timeline |
| Qingdao Foods |
| Hainan Haiqi Transpo |
Qingdao Foods and Hainan Haiqi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qingdao Foods and Hainan Haiqi
The main advantage of trading using opposite Qingdao Foods and Hainan Haiqi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qingdao Foods position performs unexpectedly, Hainan Haiqi 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 Hainan Haiqi will offset losses from the drop in Hainan Haiqi's long position.| Qingdao Foods vs. Xinjiang Baodi Mining | Qingdao Foods vs. Ningbo Construction Co | Qingdao Foods vs. Shenzhen Zhongzhuang Construction | Qingdao Foods vs. Huasi Agricultural Development |
| Hainan Haiqi vs. Hainan Mining Co | Hainan Haiqi vs. Bank of Communications | Hainan Haiqi vs. Hefei Metalforming Mach | Hainan Haiqi vs. Zijin Mining Group |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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