Correlation Between Beijing HuaYuanYiTong and Unisplendour Corp
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By analyzing existing cross correlation between Beijing HuaYuanYiTong Thermal and Unisplendour Corp, you can compare the effects of market volatilities on Beijing HuaYuanYiTong and Unisplendour Corp 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 Beijing HuaYuanYiTong with a short position of Unisplendour Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing HuaYuanYiTong and Unisplendour Corp.
Diversification Opportunities for Beijing HuaYuanYiTong and Unisplendour Corp
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Beijing and Unisplendour is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Beijing HuaYuanYiTong Thermal and Unisplendour Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unisplendour Corp and Beijing HuaYuanYiTong 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 Beijing HuaYuanYiTong Thermal are associated (or correlated) with Unisplendour Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unisplendour Corp has no effect on the direction of Beijing HuaYuanYiTong i.e., Beijing HuaYuanYiTong and Unisplendour Corp go up and down completely randomly.
Pair Corralation between Beijing HuaYuanYiTong and Unisplendour Corp
Assuming the 90 days trading horizon Beijing HuaYuanYiTong Thermal is expected to under-perform the Unisplendour Corp. But the stock apears to be less risky and, when comparing its historical volatility, Beijing HuaYuanYiTong Thermal is 1.72 times less risky than Unisplendour Corp. The stock trades about -0.51 of its potential returns per unit of risk. The Unisplendour Corp is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 2,498 in Unisplendour Corp on October 16, 2024 and sell it today you would lose (97.00) from holding Unisplendour Corp or give up 3.88% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Beijing HuaYuanYiTong Thermal vs. Unisplendour Corp
Performance |
Timeline |
Beijing HuaYuanYiTong |
Unisplendour Corp |
Beijing HuaYuanYiTong and Unisplendour Corp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Beijing HuaYuanYiTong and Unisplendour Corp
The main advantage of trading using opposite Beijing HuaYuanYiTong and Unisplendour Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing HuaYuanYiTong position performs unexpectedly, Unisplendour Corp 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 Unisplendour Corp will offset losses from the drop in Unisplendour Corp's long position.Beijing HuaYuanYiTong vs. Biwin Storage Technology | Beijing HuaYuanYiTong vs. PetroChina Co Ltd | Beijing HuaYuanYiTong vs. Industrial and Commercial | Beijing HuaYuanYiTong vs. China Construction Bank |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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