Correlation Between Huasi Agricultural and Liuzhou Chemical
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By analyzing existing cross correlation between Huasi Agricultural Development and Liuzhou Chemical Industry, you can compare the effects of market volatilities on Huasi Agricultural and Liuzhou Chemical 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 Liuzhou Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huasi Agricultural and Liuzhou Chemical.
Diversification Opportunities for Huasi Agricultural and Liuzhou Chemical
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Huasi and Liuzhou is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Huasi Agricultural Development and Liuzhou Chemical Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liuzhou Chemical Industry 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 Liuzhou Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liuzhou Chemical Industry has no effect on the direction of Huasi Agricultural i.e., Huasi Agricultural and Liuzhou Chemical go up and down completely randomly.
Pair Corralation between Huasi Agricultural and Liuzhou Chemical
Assuming the 90 days trading horizon Huasi Agricultural Development is expected to under-perform the Liuzhou Chemical. But the stock apears to be less risky and, when comparing its historical volatility, Huasi Agricultural Development is 1.05 times less risky than Liuzhou Chemical. The stock trades about -0.24 of its potential returns per unit of risk. The Liuzhou Chemical Industry is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 333.00 in Liuzhou Chemical Industry on October 17, 2024 and sell it today you would earn a total of 6.00 from holding Liuzhou Chemical Industry or generate 1.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Huasi Agricultural Development vs. Liuzhou Chemical Industry
Performance |
| Timeline |
| Huasi Agricultural |
| Liuzhou Chemical Industry |
Huasi Agricultural and Liuzhou Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huasi Agricultural and Liuzhou Chemical
The main advantage of trading using opposite Huasi Agricultural and Liuzhou Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huasi Agricultural position performs unexpectedly, Liuzhou Chemical 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 Liuzhou Chemical will offset losses from the drop in Liuzhou Chemical's long position.| Huasi Agricultural vs. Jinhui Mining Co | Huasi Agricultural vs. China Aluminum International | Huasi Agricultural vs. Shenzhen Silver Basis | Huasi Agricultural vs. Shanghai Yanpu Metal |
| Liuzhou Chemical vs. Hunan Investment Group | Liuzhou Chemical vs. Eastroc Beverage Group | Liuzhou Chemical vs. StarPower Semiconductor | Liuzhou Chemical vs. Thinkon Semiconductor Jinzhou |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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