Correlation Between Shandong Longquan and Holitech Technology
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By analyzing existing cross correlation between Shandong Longquan Pipeline and Holitech Technology Co, you can compare the effects of market volatilities on Shandong Longquan and Holitech Technology 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 Shandong Longquan with a short position of Holitech Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Longquan and Holitech Technology.
Diversification Opportunities for Shandong Longquan and Holitech Technology
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shandong and Holitech is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Longquan Pipeline and Holitech Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holitech Technology and Shandong Longquan 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 Shandong Longquan Pipeline are associated (or correlated) with Holitech Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holitech Technology has no effect on the direction of Shandong Longquan i.e., Shandong Longquan and Holitech Technology go up and down completely randomly.
Pair Corralation between Shandong Longquan and Holitech Technology
Assuming the 90 days trading horizon Shandong Longquan Pipeline is expected to generate 0.77 times more return on investment than Holitech Technology. However, Shandong Longquan Pipeline is 1.29 times less risky than Holitech Technology. It trades about 0.02 of its potential returns per unit of risk. Holitech Technology Co is currently generating about 0.01 per unit of risk. If you would invest 435.00 in Shandong Longquan Pipeline on August 24, 2024 and sell it today you would earn a total of 20.00 from holding Shandong Longquan Pipeline or generate 4.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Longquan Pipeline vs. Holitech Technology Co
Performance |
| Timeline |
| Shandong Longquan |
| Holitech Technology |
Shandong Longquan and Holitech Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Longquan and Holitech Technology
The main advantage of trading using opposite Shandong Longquan and Holitech Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Longquan position performs unexpectedly, Holitech Technology 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 Holitech Technology will offset losses from the drop in Holitech Technology's long position.| Shandong Longquan vs. Shenzhen Noposion Agrochemicals | Shandong Longquan vs. Shandong Ruifeng Chemical | Shandong Longquan vs. Lier Chemical Co | Shandong Longquan vs. Jilin Chemical Fibre |
| Holitech Technology vs. Ming Yang Smart | Holitech Technology vs. 159005 | Holitech Technology vs. Loctek Ergonomic Technology | Holitech Technology vs. Xiamen East Asia |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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