Correlation Between Holitech Technology and Weichai Heavy
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By analyzing existing cross correlation between Holitech Technology Co and Weichai Heavy Machinery, you can compare the effects of market volatilities on Holitech Technology and Weichai Heavy 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 Holitech Technology with a short position of Weichai Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Holitech Technology and Weichai Heavy.
Diversification Opportunities for Holitech Technology and Weichai Heavy
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Holitech and Weichai is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Holitech Technology Co and Weichai Heavy Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weichai Heavy Machinery and Holitech Technology 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 Holitech Technology Co are associated (or correlated) with Weichai Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weichai Heavy Machinery has no effect on the direction of Holitech Technology i.e., Holitech Technology and Weichai Heavy go up and down completely randomly.
Pair Corralation between Holitech Technology and Weichai Heavy
Assuming the 90 days trading horizon Holitech Technology Co is expected to generate 0.78 times more return on investment than Weichai Heavy. However, Holitech Technology Co is 1.28 times less risky than Weichai Heavy. It trades about 0.15 of its potential returns per unit of risk. Weichai Heavy Machinery is currently generating about 0.1 per unit of risk. If you would invest 130.00 in Holitech Technology Co on September 1, 2024 and sell it today you would earn a total of 89.00 from holding Holitech Technology Co or generate 68.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Holitech Technology Co vs. Weichai Heavy Machinery
Performance |
| Timeline |
| Holitech Technology |
| Weichai Heavy Machinery |
Holitech Technology and Weichai Heavy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Holitech Technology and Weichai Heavy
The main advantage of trading using opposite Holitech Technology and Weichai Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Holitech Technology position performs unexpectedly, Weichai Heavy 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 Weichai Heavy will offset losses from the drop in Weichai Heavy's long position.| Holitech Technology vs. Cultural Investment Holdings | Holitech Technology vs. Gome Telecom Equipment | Holitech Technology vs. Bus Online Co | Holitech Technology vs. Zotye Automobile Co |
| Weichai Heavy vs. Cultural Investment Holdings | Weichai Heavy vs. Gome Telecom Equipment | Weichai Heavy vs. Bus Online Co | Weichai Heavy vs. Holitech Technology Co |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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