Correlation Between Holitech Technology and Wuxi Chemical
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By analyzing existing cross correlation between Holitech Technology Co and Wuxi Chemical Equipment, you can compare the effects of market volatilities on Holitech Technology and Wuxi Chemical 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 Wuxi Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Holitech Technology and Wuxi Chemical.
Diversification Opportunities for Holitech Technology and Wuxi Chemical
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Holitech and Wuxi is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Holitech Technology Co and Wuxi Chemical Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wuxi Chemical Equipment 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 Wuxi Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wuxi Chemical Equipment has no effect on the direction of Holitech Technology i.e., Holitech Technology and Wuxi Chemical go up and down completely randomly.
Pair Corralation between Holitech Technology and Wuxi Chemical
Assuming the 90 days trading horizon Holitech Technology Co is expected to generate 1.6 times more return on investment than Wuxi Chemical. However, Holitech Technology is 1.6 times more volatile than Wuxi Chemical Equipment. It trades about 0.38 of its potential returns per unit of risk. Wuxi Chemical Equipment is currently generating about 0.11 per unit of risk. If you would invest 166.00 in Holitech Technology Co on August 31, 2024 and sell it today you would earn a total of 64.00 from holding Holitech Technology Co or generate 38.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Holitech Technology Co vs. Wuxi Chemical Equipment
Performance |
| Timeline |
| Holitech Technology |
| Wuxi Chemical Equipment |
Holitech Technology and Wuxi Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Holitech Technology and Wuxi Chemical
The main advantage of trading using opposite Holitech Technology and Wuxi Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Holitech Technology position performs unexpectedly, Wuxi Chemical 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 Wuxi Chemical will offset losses from the drop in Wuxi Chemical's long position.| Holitech Technology vs. Kweichow Moutai Co | Holitech Technology vs. NAURA Technology Group | Holitech Technology vs. APT Medical | Holitech Technology vs. Contemporary Amperex Technology |
| Wuxi Chemical vs. Cultural Investment Holdings | Wuxi Chemical vs. Gome Telecom Equipment | Wuxi Chemical vs. Bus Online Co | Wuxi Chemical 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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