Correlation Between Sichuan Fulin and Hunan TV
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By analyzing existing cross correlation between Sichuan Fulin Transportation and Hunan TV Broadcast, you can compare the effects of market volatilities on Sichuan Fulin and Hunan TV 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 Sichuan Fulin with a short position of Hunan TV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Fulin and Hunan TV.
Diversification Opportunities for Sichuan Fulin and Hunan TV
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sichuan and Hunan is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Fulin Transportation and Hunan TV Broadcast in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hunan TV Broadcast and Sichuan Fulin 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 Sichuan Fulin Transportation are associated (or correlated) with Hunan TV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hunan TV Broadcast has no effect on the direction of Sichuan Fulin i.e., Sichuan Fulin and Hunan TV go up and down completely randomly.
Pair Corralation between Sichuan Fulin and Hunan TV
Assuming the 90 days trading horizon Sichuan Fulin is expected to generate 5.03 times less return on investment than Hunan TV. But when comparing it to its historical volatility, Sichuan Fulin Transportation is 1.15 times less risky than Hunan TV. It trades about 0.01 of its potential returns per unit of risk. Hunan TV Broadcast is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 510.00 in Hunan TV Broadcast on September 3, 2024 and sell it today you would earn a total of 315.00 from holding Hunan TV Broadcast or generate 61.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Fulin Transportation vs. Hunan TV Broadcast
Performance |
| Timeline |
| Sichuan Fulin Transp |
| Hunan TV Broadcast |
Sichuan Fulin and Hunan TV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Fulin and Hunan TV
The main advantage of trading using opposite Sichuan Fulin and Hunan TV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Fulin position performs unexpectedly, Hunan TV 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 Hunan TV will offset losses from the drop in Hunan TV's long position.| Sichuan Fulin vs. Humanwell Healthcare Group | Sichuan Fulin vs. Healthcare Co | Sichuan Fulin vs. Xizi Clean Energy | Sichuan Fulin vs. Yunnan Jianzhijia Health Chain |
| Hunan TV vs. Maccura Biotechnology Co | Hunan TV vs. Shanghai Rendu Biotechnology | Hunan TV vs. Jinhe Biotechnology Co | Hunan TV vs. Wuhan Hvsen Biotechnology |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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