Correlation Between Guizhou Chanhen and Hua Xia
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By analyzing existing cross correlation between Guizhou Chanhen Chemical and Hua Xia Bank, you can compare the effects of market volatilities on Guizhou Chanhen and Hua Xia 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 Guizhou Chanhen with a short position of Hua Xia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guizhou Chanhen and Hua Xia.
Diversification Opportunities for Guizhou Chanhen and Hua Xia
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guizhou and Hua is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Guizhou Chanhen Chemical and Hua Xia Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hua Xia Bank and Guizhou Chanhen 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 Guizhou Chanhen Chemical are associated (or correlated) with Hua Xia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hua Xia Bank has no effect on the direction of Guizhou Chanhen i.e., Guizhou Chanhen and Hua Xia go up and down completely randomly.
Pair Corralation between Guizhou Chanhen and Hua Xia
Assuming the 90 days trading horizon Guizhou Chanhen Chemical is expected to under-perform the Hua Xia. In addition to that, Guizhou Chanhen is 2.03 times more volatile than Hua Xia Bank. It trades about -0.1 of its total potential returns per unit of risk. Hua Xia Bank is currently generating about -0.16 per unit of volatility. If you would invest 778.00 in Hua Xia Bank on October 15, 2024 and sell it today you would lose (30.00) from holding Hua Xia Bank or give up 3.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guizhou Chanhen Chemical vs. Hua Xia Bank
Performance |
| Timeline |
| Guizhou Chanhen Chemical |
| Hua Xia Bank |
Guizhou Chanhen and Hua Xia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guizhou Chanhen and Hua Xia
The main advantage of trading using opposite Guizhou Chanhen and Hua Xia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guizhou Chanhen position performs unexpectedly, Hua Xia 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 Hua Xia will offset losses from the drop in Hua Xia's long position.| Guizhou Chanhen vs. Xiamen Goldenhome Co | Guizhou Chanhen vs. China Sports Industry | Guizhou Chanhen vs. Shanghai Shuixing Home | Guizhou Chanhen vs. Oppein Home Group |
| Hua Xia vs. Jiangsu Jinling Sports | Hua Xia vs. Shandong Rike Chemical | Hua Xia vs. Xiangtan Electrochemical Scientific | Hua Xia vs. Guizhou Chanhen Chemical |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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