Correlation Between Hunya Foods and Nan Pao
Can any of the company-specific risk be diversified away by investing in both Hunya Foods and Nan Pao at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Hunya Foods and Nan Pao into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hunya Foods Co and Nan Pao Resins, you can compare the effects of market volatilities on Hunya Foods and Nan Pao 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 Hunya Foods with a short position of Nan Pao. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunya Foods and Nan Pao.
Diversification Opportunities for Hunya Foods and Nan Pao
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hunya and Nan is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Hunya Foods Co and Nan Pao Resins in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nan Pao Resins and Hunya Foods 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 Hunya Foods Co are associated (or correlated) with Nan Pao. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nan Pao Resins has no effect on the direction of Hunya Foods i.e., Hunya Foods and Nan Pao go up and down completely randomly.
Pair Corralation between Hunya Foods and Nan Pao
Assuming the 90 days trading horizon Hunya Foods is expected to generate 72.21 times less return on investment than Nan Pao. But when comparing it to its historical volatility, Hunya Foods Co is 1.88 times less risky than Nan Pao. It trades about 0.0 of its potential returns per unit of risk. Nan Pao Resins is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 16,650 in Nan Pao Resins on September 12, 2024 and sell it today you would earn a total of 15,550 from holding Nan Pao Resins or generate 93.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hunya Foods Co vs. Nan Pao Resins
Performance |
| Timeline |
| Hunya Foods |
| Nan Pao Resins |
Hunya Foods and Nan Pao Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hunya Foods and Nan Pao
The main advantage of trading using opposite Hunya Foods and Nan Pao positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunya Foods position performs unexpectedly, Nan Pao 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 Nan Pao will offset losses from the drop in Nan Pao's long position.| Hunya Foods vs. Standard Foods Corp | Hunya Foods vs. Uni President Enterprises Corp | Hunya Foods vs. Great Wall Enterprise | Hunya Foods vs. Ruentex Development Co |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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