Correlation Between Kangyue Technology and Hangzhou Lion
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By analyzing existing cross correlation between Kangyue Technology Co and Hangzhou Lion Electronics, you can compare the effects of market volatilities on Kangyue Technology and Hangzhou Lion 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 Kangyue Technology with a short position of Hangzhou Lion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kangyue Technology and Hangzhou Lion.
Diversification Opportunities for Kangyue Technology and Hangzhou Lion
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kangyue and Hangzhou is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Kangyue Technology Co and Hangzhou Lion Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hangzhou Lion Electronics and Kangyue Technology 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 Kangyue Technology Co are associated (or correlated) with Hangzhou Lion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hangzhou Lion Electronics has no effect on the direction of Kangyue Technology i.e., Kangyue Technology and Hangzhou Lion go up and down completely randomly.
Pair Corralation between Kangyue Technology and Hangzhou Lion
Assuming the 90 days trading horizon Kangyue Technology Co is expected to generate 2.3 times more return on investment than Hangzhou Lion. However, Kangyue Technology is 2.3 times more volatile than Hangzhou Lion Electronics. It trades about 0.14 of its potential returns per unit of risk. Hangzhou Lion Electronics is currently generating about 0.07 per unit of risk. If you would invest 276.00 in Kangyue Technology Co on September 3, 2024 and sell it today you would earn a total of 440.00 from holding Kangyue Technology Co or generate 159.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kangyue Technology Co vs. Hangzhou Lion Electronics
Performance |
| Timeline |
| Kangyue Technology |
| Hangzhou Lion Electronics |
Kangyue Technology and Hangzhou Lion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kangyue Technology and Hangzhou Lion
The main advantage of trading using opposite Kangyue Technology and Hangzhou Lion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kangyue Technology position performs unexpectedly, Hangzhou Lion 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 Hangzhou Lion will offset losses from the drop in Hangzhou Lion's long position.| Kangyue Technology vs. PetroChina Co Ltd | Kangyue Technology vs. China Mobile Limited | Kangyue Technology vs. Industrial and Commercial | Kangyue Technology vs. China Life Insurance |
| Hangzhou Lion vs. Touchstone International Medical | Hangzhou Lion vs. Qilu Bank Co | Hangzhou Lion vs. Shenzhen Glory Medical | Hangzhou Lion vs. Sino Medical Sciences |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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