Correlation Between Huasi Agricultural and Hubeiyichang Transportation
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By analyzing existing cross correlation between Huasi Agricultural Development and Hubeiyichang Transportation Group, you can compare the effects of market volatilities on Huasi Agricultural and Hubeiyichang Transportation 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 Huasi Agricultural with a short position of Hubeiyichang Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huasi Agricultural and Hubeiyichang Transportation.
Diversification Opportunities for Huasi Agricultural and Hubeiyichang Transportation
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Huasi and Hubeiyichang is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Huasi Agricultural Development and Hubeiyichang Transportation Gr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubeiyichang Transportation and Huasi Agricultural 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 Huasi Agricultural Development are associated (or correlated) with Hubeiyichang Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubeiyichang Transportation has no effect on the direction of Huasi Agricultural i.e., Huasi Agricultural and Hubeiyichang Transportation go up and down completely randomly.
Pair Corralation between Huasi Agricultural and Hubeiyichang Transportation
Assuming the 90 days trading horizon Huasi Agricultural Development is expected to generate 1.35 times more return on investment than Hubeiyichang Transportation. However, Huasi Agricultural is 1.35 times more volatile than Hubeiyichang Transportation Group. It trades about 0.24 of its potential returns per unit of risk. Hubeiyichang Transportation Group is currently generating about -0.18 per unit of risk. If you would invest 403.00 in Huasi Agricultural Development on November 28, 2024 and sell it today you would earn a total of 29.00 from holding Huasi Agricultural Development or generate 7.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.12% |
| Values | Daily Returns |
Huasi Agricultural Development vs. Hubeiyichang Transportation Gr
Performance |
| Timeline |
| Huasi Agricultural |
| Hubeiyichang Transportation |
Huasi Agricultural and Hubeiyichang Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huasi Agricultural and Hubeiyichang Transportation
The main advantage of trading using opposite Huasi Agricultural and Hubeiyichang Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huasi Agricultural position performs unexpectedly, Hubeiyichang Transportation 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 Hubeiyichang Transportation will offset losses from the drop in Hubeiyichang Transportation's long position.| Huasi Agricultural vs. Lander Sports Development | Huasi Agricultural vs. Sportsoul Co Ltd | Huasi Agricultural vs. China Sports Industry | Huasi Agricultural vs. Western Metal Materials |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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