Correlation Between New Hope and Loongson Technology
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By analyzing existing cross correlation between New Hope Dairy and Loongson Technology Corp, you can compare the effects of market volatilities on New Hope and Loongson 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 New Hope with a short position of Loongson Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Hope and Loongson Technology.
Diversification Opportunities for New Hope and Loongson Technology
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between New and Loongson is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding New Hope Dairy and Loongson Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loongson Technology Corp 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 Loongson Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loongson Technology Corp has no effect on the direction of New Hope i.e., New Hope and Loongson Technology go up and down completely randomly.
Pair Corralation between New Hope and Loongson Technology
Assuming the 90 days trading horizon New Hope Dairy is expected to generate 1.24 times more return on investment than Loongson Technology. However, New Hope is 1.24 times more volatile than Loongson Technology Corp. It trades about 0.15 of its potential returns per unit of risk. Loongson Technology Corp is currently generating about -0.16 per unit of risk. If you would invest 1,240 in New Hope Dairy on October 26, 2024 and sell it today you would earn a total of 250.00 from holding New Hope Dairy or generate 20.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
New Hope Dairy vs. Loongson Technology Corp
Performance |
| Timeline |
| New Hope Dairy |
| Loongson Technology Corp |
New Hope and Loongson Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New Hope and Loongson Technology
The main advantage of trading using opposite New Hope and Loongson Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Hope position performs unexpectedly, Loongson 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 Loongson Technology will offset losses from the drop in Loongson Technology's long position.| New Hope vs. Kweichow Moutai Co | New Hope vs. Contemporary Amperex Technology | New Hope vs. G bits Network Technology | New Hope vs. Beijing Roborock Technology |
| Loongson Technology vs. Qingdao Foods Co | Loongson Technology vs. Gan Yuan Foods | Loongson Technology vs. Fibocom Wireless | Loongson Technology vs. New Hope Dairy |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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