Correlation Between ZYF Lopsking and HUAQIN TECHNOLOGY
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By analyzing existing cross correlation between ZYF Lopsking Aluminum and HUAQIN TECHNOLOGY LTD, you can compare the effects of market volatilities on ZYF Lopsking and HUAQIN TECHNOLOGY 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 ZYF Lopsking with a short position of HUAQIN TECHNOLOGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZYF Lopsking and HUAQIN TECHNOLOGY.
Diversification Opportunities for ZYF Lopsking and HUAQIN TECHNOLOGY
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ZYF and HUAQIN is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding ZYF Lopsking Aluminum and HUAQIN TECHNOLOGY LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUAQIN TECHNOLOGY LTD and ZYF Lopsking 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 ZYF Lopsking Aluminum are associated (or correlated) with HUAQIN TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HUAQIN TECHNOLOGY LTD has no effect on the direction of ZYF Lopsking i.e., ZYF Lopsking and HUAQIN TECHNOLOGY go up and down completely randomly.
Pair Corralation between ZYF Lopsking and HUAQIN TECHNOLOGY
Assuming the 90 days trading horizon ZYF Lopsking is expected to generate 1.92 times less return on investment than HUAQIN TECHNOLOGY. But when comparing it to its historical volatility, ZYF Lopsking Aluminum is 1.2 times less risky than HUAQIN TECHNOLOGY. It trades about 0.12 of its potential returns per unit of risk. HUAQIN TECHNOLOGY LTD is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 5,640 in HUAQIN TECHNOLOGY LTD on September 3, 2024 and sell it today you would earn a total of 615.00 from holding HUAQIN TECHNOLOGY LTD or generate 10.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ZYF Lopsking Aluminum vs. HUAQIN TECHNOLOGY LTD
Performance |
| Timeline |
| ZYF Lopsking Aluminum |
| HUAQIN TECHNOLOGY LTD |
ZYF Lopsking and HUAQIN TECHNOLOGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZYF Lopsking and HUAQIN TECHNOLOGY
The main advantage of trading using opposite ZYF Lopsking and HUAQIN TECHNOLOGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZYF Lopsking position performs unexpectedly, HUAQIN TECHNOLOGY 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 HUAQIN TECHNOLOGY will offset losses from the drop in HUAQIN TECHNOLOGY's long position.| ZYF Lopsking vs. Zijin Mining Group | ZYF Lopsking vs. Baoshan Iron Steel | ZYF Lopsking vs. Hoshine Silicon Ind |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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