Correlation Between Dymatic Chemicals and Hubeiyichang Transportation
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By analyzing existing cross correlation between Dymatic Chemicals and Hubeiyichang Transportation Group, you can compare the effects of market volatilities on Dymatic Chemicals and Hubeiyichang Transportation 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 Dymatic Chemicals with a short position of Hubeiyichang Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dymatic Chemicals and Hubeiyichang Transportation.
Diversification Opportunities for Dymatic Chemicals and Hubeiyichang Transportation
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dymatic and Hubeiyichang is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Dymatic Chemicals and Hubeiyichang Transportation Gr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubeiyichang Transportation and Dymatic Chemicals 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 Dymatic Chemicals are associated (or correlated) with Hubeiyichang Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubeiyichang Transportation has no effect on the direction of Dymatic Chemicals i.e., Dymatic Chemicals and Hubeiyichang Transportation go up and down completely randomly.
Pair Corralation between Dymatic Chemicals and Hubeiyichang Transportation
Assuming the 90 days trading horizon Dymatic Chemicals is expected to under-perform the Hubeiyichang Transportation. In addition to that, Dymatic Chemicals is 1.32 times more volatile than Hubeiyichang Transportation Group. It trades about -0.01 of its total potential returns per unit of risk. Hubeiyichang Transportation Group is currently generating about -0.01 per unit of volatility. If you would invest 521.00 in Hubeiyichang Transportation Group on October 15, 2024 and sell it today you would lose (58.00) from holding Hubeiyichang Transportation Group or give up 11.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dymatic Chemicals vs. Hubeiyichang Transportation Gr
Performance |
| Timeline |
| Dymatic Chemicals |
| Hubeiyichang Transportation |
Dymatic Chemicals and Hubeiyichang Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dymatic Chemicals and Hubeiyichang Transportation
The main advantage of trading using opposite Dymatic Chemicals and Hubeiyichang Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dymatic Chemicals position performs unexpectedly, Hubeiyichang Transportation 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 Hubeiyichang Transportation will offset losses from the drop in Hubeiyichang Transportation's long position.| Dymatic Chemicals vs. Guangzhou KDT Machinery | Dymatic Chemicals vs. Anhui Huilong Agricultural | Dymatic Chemicals vs. Sunwave Communications Co | Dymatic Chemicals vs. Huasi Agricultural Development |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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