Correlation Between HanS Laser and Huadong Medicine
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By analyzing existing cross correlation between HanS Laser Tech and Huadong Medicine Co, you can compare the effects of market volatilities on HanS Laser and Huadong Medicine 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 HanS Laser with a short position of Huadong Medicine. Check out your portfolio center. Please also check ongoing floating volatility patterns of HanS Laser and Huadong Medicine.
Diversification Opportunities for HanS Laser and Huadong Medicine
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between HanS and Huadong is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding HanS Laser Tech and Huadong Medicine Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huadong Medicine and HanS Laser 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 HanS Laser Tech are associated (or correlated) with Huadong Medicine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huadong Medicine has no effect on the direction of HanS Laser i.e., HanS Laser and Huadong Medicine go up and down completely randomly.
Pair Corralation between HanS Laser and Huadong Medicine
Assuming the 90 days trading horizon HanS Laser Tech is expected to generate 1.22 times more return on investment than Huadong Medicine. However, HanS Laser is 1.22 times more volatile than Huadong Medicine Co. It trades about 0.03 of its potential returns per unit of risk. Huadong Medicine Co is currently generating about -0.01 per unit of risk. If you would invest 2,301 in HanS Laser Tech on September 26, 2024 and sell it today you would earn a total of 298.00 from holding HanS Laser Tech or generate 12.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.66% |
| Values | Daily Returns |
HanS Laser Tech vs. Huadong Medicine Co
Performance |
| Timeline |
| HanS Laser Tech |
| Huadong Medicine |
HanS Laser and Huadong Medicine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HanS Laser and Huadong Medicine
The main advantage of trading using opposite HanS Laser and Huadong Medicine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HanS Laser position performs unexpectedly, Huadong Medicine 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 Huadong Medicine will offset losses from the drop in Huadong Medicine's long position.| HanS Laser vs. Bank of China | HanS Laser vs. Kweichow Moutai Co | HanS Laser vs. PetroChina Co Ltd | HanS Laser vs. Bank of Communications |
| Huadong Medicine vs. Industrial and Commercial | Huadong Medicine vs. Kweichow Moutai Co | Huadong Medicine vs. Agricultural Bank of | Huadong Medicine vs. China Mobile Limited |
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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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