Correlation Between Longxing Chemical and Hunan TV
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By analyzing existing cross correlation between Longxing Chemical Stock and Hunan TV Broadcast, you can compare the effects of market volatilities on Longxing Chemical 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 Longxing Chemical with a short position of Hunan TV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Longxing Chemical and Hunan TV.
Diversification Opportunities for Longxing Chemical and Hunan TV
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Longxing and Hunan is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Longxing Chemical Stock 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 Longxing 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 Longxing Chemical Stock 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 Longxing Chemical i.e., Longxing Chemical and Hunan TV go up and down completely randomly.
Pair Corralation between Longxing Chemical and Hunan TV
Assuming the 90 days trading horizon Longxing Chemical is expected to generate 4.4 times less return on investment than Hunan TV. But when comparing it to its historical volatility, Longxing Chemical Stock is 1.3 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 0.03 of returns per unit of risk over similar time horizon. If you would invest 533.00 in Hunan TV Broadcast on October 12, 2024 and sell it today you would earn a total of 105.00 from holding Hunan TV Broadcast or generate 19.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Longxing Chemical Stock vs. Hunan TV Broadcast
Performance |
| Timeline |
| Longxing Chemical Stock |
| Hunan TV Broadcast |
Longxing Chemical and Hunan TV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Longxing Chemical and Hunan TV
The main advantage of trading using opposite Longxing Chemical and Hunan TV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Longxing Chemical 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.| Longxing Chemical vs. Sinomach General Machinery | Longxing Chemical vs. Guangzhou Dongfang Hotel | Longxing Chemical vs. Zhongzhu Medical Holdings | Longxing Chemical vs. Jinling Hotel Corp |
| Hunan TV vs. GreenTech Environmental Co | Hunan TV vs. Penyao Environmental Protection | Hunan TV vs. Longxing Chemical Stock | Hunan TV vs. Guizhou Chanhen Chemical |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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