Correlation Between Elite Color and Haima Automobile
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By analyzing existing cross correlation between Elite Color Environmental and Haima Automobile Group, you can compare the effects of market volatilities on Elite Color and Haima Automobile 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 Elite Color with a short position of Haima Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elite Color and Haima Automobile.
Diversification Opportunities for Elite Color and Haima Automobile
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Elite and Haima is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Elite Color Environmental and Haima Automobile Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haima Automobile and Elite Color 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 Elite Color Environmental are associated (or correlated) with Haima Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haima Automobile has no effect on the direction of Elite Color i.e., Elite Color and Haima Automobile go up and down completely randomly.
Pair Corralation between Elite Color and Haima Automobile
Assuming the 90 days trading horizon Elite Color is expected to generate 1.43 times less return on investment than Haima Automobile. But when comparing it to its historical volatility, Elite Color Environmental is 1.96 times less risky than Haima Automobile. It trades about 0.14 of its potential returns per unit of risk. Haima Automobile Group is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 399.00 in Haima Automobile Group on August 29, 2024 and sell it today you would earn a total of 44.00 from holding Haima Automobile Group or generate 11.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elite Color Environmental vs. Haima Automobile Group
Performance |
| Timeline |
| Elite Color Environmental |
| Haima Automobile |
Elite Color and Haima Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elite Color and Haima Automobile
The main advantage of trading using opposite Elite Color and Haima Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elite Color position performs unexpectedly, Haima Automobile 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 Haima Automobile will offset losses from the drop in Haima Automobile's long position.| Elite Color vs. Zijin Mining Group | Elite Color vs. Baoshan Iron Steel | Elite Color vs. Shandong Gold Mining | Elite Color vs. Rongsheng Petrochemical Co |
| Haima Automobile vs. Lutian Machinery Co | Haima Automobile vs. China Longyuan Power | Haima Automobile vs. Changshu Tongrun Auto | Haima Automobile vs. PetroChina Co Ltd |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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