Correlation Between Hangzhou Gaoxin and ISoftStone Information
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By analyzing existing cross correlation between Hangzhou Gaoxin Rubber and iSoftStone Information Technology, you can compare the effects of market volatilities on Hangzhou Gaoxin and ISoftStone Information 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 Hangzhou Gaoxin with a short position of ISoftStone Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hangzhou Gaoxin and ISoftStone Information.
Diversification Opportunities for Hangzhou Gaoxin and ISoftStone Information
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hangzhou and ISoftStone is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Hangzhou Gaoxin Rubber and iSoftStone Information Technol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iSoftStone Information and Hangzhou Gaoxin 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 Hangzhou Gaoxin Rubber are associated (or correlated) with ISoftStone Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iSoftStone Information has no effect on the direction of Hangzhou Gaoxin i.e., Hangzhou Gaoxin and ISoftStone Information go up and down completely randomly.
Pair Corralation between Hangzhou Gaoxin and ISoftStone Information
Assuming the 90 days trading horizon Hangzhou Gaoxin Rubber is expected to generate 0.62 times more return on investment than ISoftStone Information. However, Hangzhou Gaoxin Rubber is 1.6 times less risky than ISoftStone Information. It trades about 0.06 of its potential returns per unit of risk. iSoftStone Information Technology is currently generating about -0.05 per unit of risk. If you would invest 1,050 in Hangzhou Gaoxin Rubber on September 1, 2024 and sell it today you would earn a total of 32.00 from holding Hangzhou Gaoxin Rubber or generate 3.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hangzhou Gaoxin Rubber vs. iSoftStone Information Technol
Performance |
| Timeline |
| Hangzhou Gaoxin Rubber |
| iSoftStone Information |
Hangzhou Gaoxin and ISoftStone Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hangzhou Gaoxin and ISoftStone Information
The main advantage of trading using opposite Hangzhou Gaoxin and ISoftStone Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hangzhou Gaoxin position performs unexpectedly, ISoftStone Information 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 ISoftStone Information will offset losses from the drop in ISoftStone Information's long position.| Hangzhou Gaoxin vs. Shanghai Yanpu Metal | Hangzhou Gaoxin vs. Ningxia Younglight Chemicals | Hangzhou Gaoxin vs. Dymatic Chemicals | Hangzhou Gaoxin vs. CITIC Metal 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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