Correlation Between Kuang Chi and Hubei Forbon
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By analyzing existing cross correlation between Kuang Chi Technologies and Hubei Forbon Technology, you can compare the effects of market volatilities on Kuang Chi and Hubei Forbon 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 Kuang Chi with a short position of Hubei Forbon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuang Chi and Hubei Forbon.
Diversification Opportunities for Kuang Chi and Hubei Forbon
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kuang and Hubei is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Kuang Chi Technologies and Hubei Forbon Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Forbon Technology and Kuang Chi 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 Kuang Chi Technologies are associated (or correlated) with Hubei Forbon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Forbon Technology has no effect on the direction of Kuang Chi i.e., Kuang Chi and Hubei Forbon go up and down completely randomly.
Pair Corralation between Kuang Chi and Hubei Forbon
Assuming the 90 days trading horizon Kuang Chi Technologies is expected to generate 1.86 times more return on investment than Hubei Forbon. However, Kuang Chi is 1.86 times more volatile than Hubei Forbon Technology. It trades about 0.05 of its potential returns per unit of risk. Hubei Forbon Technology is currently generating about 0.03 per unit of risk. If you would invest 3,821 in Kuang Chi Technologies on August 25, 2024 and sell it today you would earn a total of 119.00 from holding Kuang Chi Technologies or generate 3.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Kuang Chi Technologies vs. Hubei Forbon Technology
Performance |
| Timeline |
| Kuang Chi Technologies |
| Hubei Forbon Technology |
Kuang Chi and Hubei Forbon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kuang Chi and Hubei Forbon
The main advantage of trading using opposite Kuang Chi and Hubei Forbon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kuang Chi position performs unexpectedly, Hubei Forbon 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 Hubei Forbon will offset losses from the drop in Hubei Forbon's long position.| Kuang Chi vs. Loongson Technology Corp | Kuang Chi vs. Chongqing Road Bridge | Kuang Chi vs. Shenzhen Fortune Trend | Kuang Chi vs. Wuhan Xianglong Power |
| Hubei Forbon vs. Zijin Mining Group | Hubei Forbon vs. Wanhua Chemical Group | Hubei Forbon vs. Baoshan Iron Steel | Hubei Forbon vs. Shandong Gold Mining |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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