Correlation Between Wuhan Hvsen and Guangdong Shenglu
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By analyzing existing cross correlation between Wuhan Hvsen Biotechnology and Guangdong Shenglu Telecommunication, you can compare the effects of market volatilities on Wuhan Hvsen and Guangdong Shenglu 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 Wuhan Hvsen with a short position of Guangdong Shenglu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuhan Hvsen and Guangdong Shenglu.
Diversification Opportunities for Wuhan Hvsen and Guangdong Shenglu
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Wuhan and Guangdong is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Wuhan Hvsen Biotechnology and Guangdong Shenglu Telecommunic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Shenglu and Wuhan Hvsen 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 Wuhan Hvsen Biotechnology are associated (or correlated) with Guangdong Shenglu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Shenglu has no effect on the direction of Wuhan Hvsen i.e., Wuhan Hvsen and Guangdong Shenglu go up and down completely randomly.
Pair Corralation between Wuhan Hvsen and Guangdong Shenglu
Assuming the 90 days trading horizon Wuhan Hvsen Biotechnology is expected to under-perform the Guangdong Shenglu. But the stock apears to be less risky and, when comparing its historical volatility, Wuhan Hvsen Biotechnology is 1.06 times less risky than Guangdong Shenglu. The stock trades about -0.05 of its potential returns per unit of risk. The Guangdong Shenglu Telecommunication is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 1,080 in Guangdong Shenglu Telecommunication on October 14, 2024 and sell it today you would lose (471.00) from holding Guangdong Shenglu Telecommunication or give up 43.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wuhan Hvsen Biotechnology vs. Guangdong Shenglu Telecommunic
Performance |
| Timeline |
| Wuhan Hvsen Biotechnology |
| Guangdong Shenglu |
Wuhan Hvsen and Guangdong Shenglu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wuhan Hvsen and Guangdong Shenglu
The main advantage of trading using opposite Wuhan Hvsen and Guangdong Shenglu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuhan Hvsen position performs unexpectedly, Guangdong Shenglu 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 Guangdong Shenglu will offset losses from the drop in Guangdong Shenglu's long position.| Wuhan Hvsen vs. XinJiang GuoTong Pipeline | Wuhan Hvsen vs. CITIC Metal Co | Wuhan Hvsen vs. YiDong Electronics Technology | Wuhan Hvsen vs. TongFu Microelectronics Co |
| Guangdong Shenglu vs. Wuhan Hvsen Biotechnology | Guangdong Shenglu vs. Jiaozuo Wanfang Aluminum | Guangdong Shenglu vs. Shandong Sanyuan Biotechnology | Guangdong Shenglu vs. Western Metal Materials |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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