Correlation Between New Hope and Zhongyin Babi
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By analyzing existing cross correlation between New Hope Dairy and Zhongyin Babi Food, you can compare the effects of market volatilities on New Hope and Zhongyin Babi 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 New Hope with a short position of Zhongyin Babi. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Hope and Zhongyin Babi.
Diversification Opportunities for New Hope and Zhongyin Babi
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between New and Zhongyin is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding New Hope Dairy and Zhongyin Babi Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongyin Babi Food and New Hope 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 New Hope Dairy are associated (or correlated) with Zhongyin Babi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongyin Babi Food has no effect on the direction of New Hope i.e., New Hope and Zhongyin Babi go up and down completely randomly.
Pair Corralation between New Hope and Zhongyin Babi
Assuming the 90 days trading horizon New Hope Dairy is expected to generate 1.15 times more return on investment than Zhongyin Babi. However, New Hope is 1.15 times more volatile than Zhongyin Babi Food. It trades about 0.06 of its potential returns per unit of risk. Zhongyin Babi Food is currently generating about -0.52 per unit of risk. If you would invest 1,532 in New Hope Dairy on October 14, 2024 and sell it today you would earn a total of 41.00 from holding New Hope Dairy or generate 2.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
New Hope Dairy vs. Zhongyin Babi Food
Performance |
| Timeline |
| New Hope Dairy |
| Zhongyin Babi Food |
New Hope and Zhongyin Babi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New Hope and Zhongyin Babi
The main advantage of trading using opposite New Hope and Zhongyin Babi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Hope position performs unexpectedly, Zhongyin Babi 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 Zhongyin Babi will offset losses from the drop in Zhongyin Babi's long position.| New Hope vs. Tibet Huayu Mining | New Hope vs. Runjian Communication Co | New Hope vs. Pengxin International Mining | New Hope vs. Xiangyang Automobile Bearing |
| Zhongyin Babi vs. China Reform Health | Zhongyin Babi vs. Shanghai Rongtai Health | Zhongyin Babi vs. Anhui Huaren Health | Zhongyin Babi vs. Sanbo Hospital Management |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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