Correlation Between Hubeiyichang Transportation and Tibet Huayu
Specify exactly 2 symbols:
By analyzing existing cross correlation between Hubeiyichang Transportation Group and Tibet Huayu Mining, you can compare the effects of market volatilities on Hubeiyichang Transportation and Tibet Huayu 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 Hubeiyichang Transportation with a short position of Tibet Huayu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubeiyichang Transportation and Tibet Huayu.
Diversification Opportunities for Hubeiyichang Transportation and Tibet Huayu
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hubeiyichang and Tibet is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Hubeiyichang Transportation Gr and Tibet Huayu Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tibet Huayu Mining and Hubeiyichang Transportation 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 Hubeiyichang Transportation Group are associated (or correlated) with Tibet Huayu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tibet Huayu Mining has no effect on the direction of Hubeiyichang Transportation i.e., Hubeiyichang Transportation and Tibet Huayu go up and down completely randomly.
Pair Corralation between Hubeiyichang Transportation and Tibet Huayu
Assuming the 90 days trading horizon Hubeiyichang Transportation is expected to generate 7.66 times less return on investment than Tibet Huayu. But when comparing it to its historical volatility, Hubeiyichang Transportation Group is 3.36 times less risky than Tibet Huayu. It trades about 0.07 of its potential returns per unit of risk. Tibet Huayu Mining is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,249 in Tibet Huayu Mining on August 29, 2024 and sell it today you would earn a total of 186.00 from holding Tibet Huayu Mining or generate 14.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hubeiyichang Transportation Gr vs. Tibet Huayu Mining
Performance |
| Timeline |
| Hubeiyichang Transportation |
| Tibet Huayu Mining |
Hubeiyichang Transportation and Tibet Huayu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubeiyichang Transportation and Tibet Huayu
The main advantage of trading using opposite Hubeiyichang Transportation and Tibet Huayu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubeiyichang Transportation position performs unexpectedly, Tibet Huayu 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 Tibet Huayu will offset losses from the drop in Tibet Huayu's long position.The idea behind Hubeiyichang Transportation Group and Tibet Huayu Mining pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Tibet Huayu vs. Zijin Mining Group | Tibet Huayu vs. Wanhua Chemical Group | Tibet Huayu vs. Baoshan Iron Steel | Tibet Huayu 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |