Correlation Between Dirui Industrial and Huatian Hotel
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By analyzing existing cross correlation between Dirui Industrial Co and Huatian Hotel Group, you can compare the effects of market volatilities on Dirui Industrial and Huatian Hotel 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 Dirui Industrial with a short position of Huatian Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dirui Industrial and Huatian Hotel.
Diversification Opportunities for Dirui Industrial and Huatian Hotel
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dirui and Huatian is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Dirui Industrial Co and Huatian Hotel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huatian Hotel Group and Dirui Industrial 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 Dirui Industrial Co are associated (or correlated) with Huatian Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huatian Hotel Group has no effect on the direction of Dirui Industrial i.e., Dirui Industrial and Huatian Hotel go up and down completely randomly.
Pair Corralation between Dirui Industrial and Huatian Hotel
Assuming the 90 days trading horizon Dirui Industrial Co is expected to generate 1.1 times more return on investment than Huatian Hotel. However, Dirui Industrial is 1.1 times more volatile than Huatian Hotel Group. It trades about -0.01 of its potential returns per unit of risk. Huatian Hotel Group is currently generating about -0.03 per unit of risk. If you would invest 2,458 in Dirui Industrial Co on September 28, 2024 and sell it today you would lose (702.00) from holding Dirui Industrial Co or give up 28.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dirui Industrial Co vs. Huatian Hotel Group
Performance |
| Timeline |
| Dirui Industrial |
| Huatian Hotel Group |
Dirui Industrial and Huatian Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dirui Industrial and Huatian Hotel
The main advantage of trading using opposite Dirui Industrial and Huatian Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dirui Industrial position performs unexpectedly, Huatian Hotel 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 Huatian Hotel will offset losses from the drop in Huatian Hotel's long position.| Dirui Industrial vs. New China Life | Dirui Industrial vs. Ming Yang Smart | Dirui Industrial vs. 159681 | Dirui Industrial vs. 159005 |
| Huatian Hotel vs. Jiangxi Selon Industrial | Huatian Hotel vs. Qingdao Choho Industrial | Huatian Hotel vs. Dirui Industrial Co | Huatian Hotel vs. Beijing Wandong Medical |
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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