Correlation Between Hongrun Construction and Kunshan Guoli
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By analyzing existing cross correlation between Hongrun Construction Group and Kunshan Guoli Electronic, you can compare the effects of market volatilities on Hongrun Construction and Kunshan Guoli 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 Hongrun Construction with a short position of Kunshan Guoli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hongrun Construction and Kunshan Guoli.
Diversification Opportunities for Hongrun Construction and Kunshan Guoli
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hongrun and Kunshan is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Hongrun Construction Group and Kunshan Guoli Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kunshan Guoli Electronic and Hongrun Construction 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 Hongrun Construction Group are associated (or correlated) with Kunshan Guoli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kunshan Guoli Electronic has no effect on the direction of Hongrun Construction i.e., Hongrun Construction and Kunshan Guoli go up and down completely randomly.
Pair Corralation between Hongrun Construction and Kunshan Guoli
Assuming the 90 days trading horizon Hongrun Construction is expected to generate 1.57 times less return on investment than Kunshan Guoli. But when comparing it to its historical volatility, Hongrun Construction Group is 1.59 times less risky than Kunshan Guoli. It trades about 0.21 of its potential returns per unit of risk. Kunshan Guoli Electronic is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 2,876 in Kunshan Guoli Electronic on August 25, 2024 and sell it today you would earn a total of 1,348 from holding Kunshan Guoli Electronic or generate 46.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hongrun Construction Group vs. Kunshan Guoli Electronic
Performance |
| Timeline |
| Hongrun Construction |
| Kunshan Guoli Electronic |
Hongrun Construction and Kunshan Guoli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hongrun Construction and Kunshan Guoli
The main advantage of trading using opposite Hongrun Construction and Kunshan Guoli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hongrun Construction position performs unexpectedly, Kunshan Guoli 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 Kunshan Guoli will offset losses from the drop in Kunshan Guoli's long position.| Hongrun Construction vs. Ming Yang Smart | Hongrun Construction vs. 159681 | Hongrun Construction vs. 159005 | Hongrun Construction vs. Loctek Ergonomic Technology |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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