Correlation Between Holitech Technology and Senci Electric
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By analyzing existing cross correlation between Holitech Technology Co and Senci Electric Machinery, you can compare the effects of market volatilities on Holitech Technology and Senci Electric 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 Senci Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Holitech Technology and Senci Electric.
Diversification Opportunities for Holitech Technology and Senci Electric
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Holitech and Senci is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Holitech Technology Co and Senci Electric Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Senci Electric 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 Senci Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Senci Electric Machinery has no effect on the direction of Holitech Technology i.e., Holitech Technology and Senci Electric go up and down completely randomly.
Pair Corralation between Holitech Technology and Senci Electric
Assuming the 90 days trading horizon Holitech Technology Co is expected to generate 1.13 times more return on investment than Senci Electric. However, Holitech Technology is 1.13 times more volatile than Senci Electric Machinery. It trades about 0.31 of its potential returns per unit of risk. Senci Electric Machinery is currently generating about 0.17 per unit of risk. If you would invest 129.00 in Holitech Technology Co on September 12, 2024 and sell it today you would earn a total of 103.00 from holding Holitech Technology Co or generate 79.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.28% |
| Values | Daily Returns |
Holitech Technology Co vs. Senci Electric Machinery
Performance |
| Timeline |
| Holitech Technology |
| Senci Electric Machinery |
Holitech Technology and Senci Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Holitech Technology and Senci Electric
The main advantage of trading using opposite Holitech Technology and Senci Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Holitech Technology position performs unexpectedly, Senci Electric 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 Senci Electric will offset losses from the drop in Senci Electric's long position.The idea behind Holitech Technology Co and Senci Electric Machinery 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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