Correlation Between North Chemical and Tibet Huayu
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By analyzing existing cross correlation between North Chemical Industries and Tibet Huayu Mining, you can compare the effects of market volatilities on North Chemical and Tibet Huayu 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 North Chemical with a short position of Tibet Huayu. Check out your portfolio center. Please also check ongoing floating volatility patterns of North Chemical and Tibet Huayu.
Diversification Opportunities for North Chemical and Tibet Huayu
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between North and Tibet is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding North Chemical Industries and Tibet Huayu Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tibet Huayu Mining and North Chemical 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 North Chemical Industries are associated (or correlated) with Tibet Huayu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tibet Huayu Mining has no effect on the direction of North Chemical i.e., North Chemical and Tibet Huayu go up and down completely randomly.
Pair Corralation between North Chemical and Tibet Huayu
Assuming the 90 days trading horizon North Chemical Industries is expected to generate 0.86 times more return on investment than Tibet Huayu. However, North Chemical Industries is 1.16 times less risky than Tibet Huayu. It trades about 0.06 of its potential returns per unit of risk. Tibet Huayu Mining is currently generating about 0.03 per unit of risk. If you would invest 1,006 in North Chemical Industries on September 12, 2024 and sell it today you would earn a total of 192.00 from holding North Chemical Industries or generate 19.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.18% |
| Values | Daily Returns |
North Chemical Industries vs. Tibet Huayu Mining
Performance |
| Timeline |
| North Chemical Industries |
| Tibet Huayu Mining |
North Chemical and Tibet Huayu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with North Chemical and Tibet Huayu
The main advantage of trading using opposite North Chemical and Tibet Huayu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if North Chemical position performs unexpectedly, Tibet Huayu 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 Tibet Huayu will offset losses from the drop in Tibet Huayu's long position.| North Chemical vs. Xiamen Goldenhome Co | North Chemical vs. Tongyu Communication | North Chemical vs. Sichuan Jinshi Technology | North Chemical vs. Shanghai Shuixing Home |
| Tibet Huayu vs. Zijin Mining Group | Tibet Huayu vs. Wanhua Chemical Group | Tibet Huayu vs. Baoshan Iron Steel | Tibet Huayu vs. Rongsheng Petrochemical 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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