Correlation Between Holitech Technology and Shanghai Ziyan
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By analyzing existing cross correlation between Holitech Technology Co and Shanghai Ziyan Foods, you can compare the effects of market volatilities on Holitech Technology and Shanghai Ziyan 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 Shanghai Ziyan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Holitech Technology and Shanghai Ziyan.
Diversification Opportunities for Holitech Technology and Shanghai Ziyan
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Holitech and Shanghai is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Holitech Technology Co and Shanghai Ziyan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Ziyan Foods 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 Shanghai Ziyan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Ziyan Foods has no effect on the direction of Holitech Technology i.e., Holitech Technology and Shanghai Ziyan go up and down completely randomly.
Pair Corralation between Holitech Technology and Shanghai Ziyan
Assuming the 90 days trading horizon Holitech Technology Co is expected to under-perform the Shanghai Ziyan. In addition to that, Holitech Technology is 1.62 times more volatile than Shanghai Ziyan Foods. It trades about -0.07 of its total potential returns per unit of risk. Shanghai Ziyan Foods is currently generating about 0.04 per unit of volatility. If you would invest 1,748 in Shanghai Ziyan Foods on September 12, 2024 and sell it today you would earn a total of 23.00 from holding Shanghai Ziyan Foods or generate 1.32% 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. Shanghai Ziyan Foods
Performance |
| Timeline |
| Holitech Technology |
| Shanghai Ziyan Foods |
Holitech Technology and Shanghai Ziyan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Holitech Technology and Shanghai Ziyan
The main advantage of trading using opposite Holitech Technology and Shanghai Ziyan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Holitech Technology position performs unexpectedly, Shanghai Ziyan 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 Shanghai Ziyan will offset losses from the drop in Shanghai Ziyan's long position.The idea behind Holitech Technology Co and Shanghai Ziyan Foods pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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