Correlation Between Hubei Forbon and Mingchen Health
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By analyzing existing cross correlation between Hubei Forbon Technology and Mingchen Health Co, you can compare the effects of market volatilities on Hubei Forbon and Mingchen Health 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 Hubei Forbon with a short position of Mingchen Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubei Forbon and Mingchen Health.
Diversification Opportunities for Hubei Forbon and Mingchen Health
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hubei and Mingchen is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Hubei Forbon Technology and Mingchen Health Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mingchen Health and Hubei Forbon 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 Hubei Forbon Technology are associated (or correlated) with Mingchen Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mingchen Health has no effect on the direction of Hubei Forbon i.e., Hubei Forbon and Mingchen Health go up and down completely randomly.
Pair Corralation between Hubei Forbon and Mingchen Health
Assuming the 90 days trading horizon Hubei Forbon Technology is expected to generate 0.78 times more return on investment than Mingchen Health. However, Hubei Forbon Technology is 1.28 times less risky than Mingchen Health. It trades about 0.04 of its potential returns per unit of risk. Mingchen Health Co is currently generating about 0.0 per unit of risk. If you would invest 674.00 in Hubei Forbon Technology on September 4, 2024 and sell it today you would earn a total of 253.00 from holding Hubei Forbon Technology or generate 37.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hubei Forbon Technology vs. Mingchen Health Co
Performance |
| Timeline |
| Hubei Forbon Technology |
| Mingchen Health |
Hubei Forbon and Mingchen Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubei Forbon and Mingchen Health
The main advantage of trading using opposite Hubei Forbon and Mingchen Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubei Forbon position performs unexpectedly, Mingchen Health 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 Mingchen Health will offset losses from the drop in Mingchen Health's long position.| Hubei Forbon vs. Zijin Mining Group | Hubei Forbon vs. Wanhua Chemical Group | Hubei Forbon vs. Baoshan Iron Steel | Hubei Forbon vs. Rongsheng Petrochemical Co |
| Mingchen Health vs. Kuangda Technology Group | Mingchen Health vs. Dhc Software Co | Mingchen Health vs. Sinofibers Technology Co | Mingchen Health vs. Eastern Communications 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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