Correlation Between Huasi Agricultural and China Construction
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By analyzing existing cross correlation between Huasi Agricultural Development and China Construction Bank, you can compare the effects of market volatilities on Huasi Agricultural and China Construction 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 China Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huasi Agricultural and China Construction.
Diversification Opportunities for Huasi Agricultural and China Construction
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Huasi and China is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Huasi Agricultural Development and China Construction Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Construction Bank 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 China Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Construction Bank has no effect on the direction of Huasi Agricultural i.e., Huasi Agricultural and China Construction go up and down completely randomly.
Pair Corralation between Huasi Agricultural and China Construction
Assuming the 90 days trading horizon Huasi Agricultural Development is expected to generate 2.53 times more return on investment than China Construction. However, Huasi Agricultural is 2.53 times more volatile than China Construction Bank. It trades about 0.35 of its potential returns per unit of risk. China Construction Bank is currently generating about -0.1 per unit of risk. If you would invest 385.00 in Huasi Agricultural Development on September 4, 2024 and sell it today you would earn a total of 61.00 from holding Huasi Agricultural Development or generate 15.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huasi Agricultural Development vs. China Construction Bank
Performance |
| Timeline |
| Huasi Agricultural |
| China Construction Bank |
Huasi Agricultural and China Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huasi Agricultural and China Construction
The main advantage of trading using opposite Huasi Agricultural and China Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huasi Agricultural position performs unexpectedly, China Construction 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 China Construction will offset losses from the drop in China Construction's long position.| Huasi Agricultural vs. Industrial and Commercial | Huasi Agricultural vs. Agricultural Bank of | Huasi Agricultural vs. China Construction Bank | Huasi Agricultural vs. Bank of China |
| China Construction vs. Henan Shuanghui Investment | China Construction vs. Servyou Software Group | China Construction vs. Hunan Investment Group | China Construction vs. Harbin Hatou Investment |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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