Correlation Between Zhuhai Bojay and Huadong Medicine
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By analyzing existing cross correlation between Zhuhai Bojay Electronics and Huadong Medicine Co, you can compare the effects of market volatilities on Zhuhai Bojay and Huadong Medicine 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 Zhuhai Bojay with a short position of Huadong Medicine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhuhai Bojay and Huadong Medicine.
Diversification Opportunities for Zhuhai Bojay and Huadong Medicine
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhuhai and Huadong is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Zhuhai Bojay Electronics and Huadong Medicine Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huadong Medicine and Zhuhai Bojay 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 Zhuhai Bojay Electronics are associated (or correlated) with Huadong Medicine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huadong Medicine has no effect on the direction of Zhuhai Bojay i.e., Zhuhai Bojay and Huadong Medicine go up and down completely randomly.
Pair Corralation between Zhuhai Bojay and Huadong Medicine
Assuming the 90 days trading horizon Zhuhai Bojay Electronics is expected to generate 1.9 times more return on investment than Huadong Medicine. However, Zhuhai Bojay is 1.9 times more volatile than Huadong Medicine Co. It trades about 0.0 of its potential returns per unit of risk. Huadong Medicine Co is currently generating about -0.02 per unit of risk. If you would invest 2,850 in Zhuhai Bojay Electronics on October 14, 2024 and sell it today you would lose (133.00) from holding Zhuhai Bojay Electronics or give up 4.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhuhai Bojay Electronics vs. Huadong Medicine Co
Performance |
| Timeline |
| Zhuhai Bojay Electronics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Huadong Medicine |
Zhuhai Bojay and Huadong Medicine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhuhai Bojay and Huadong Medicine
The main advantage of trading using opposite Zhuhai Bojay and Huadong Medicine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhuhai Bojay position performs unexpectedly, Huadong Medicine 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 Huadong Medicine will offset losses from the drop in Huadong Medicine's long position.| Zhuhai Bojay vs. Guangzhou Jointas Chemical | Zhuhai Bojay vs. Guizhou Chanhen Chemical | Zhuhai Bojay vs. Fiberhome Telecommunication Technologies | Zhuhai Bojay vs. Runjian Communication Co |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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