Correlation Between Huali Industrial and Tibet Huayu
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By analyzing existing cross correlation between Huali Industrial Group and Tibet Huayu Mining, you can compare the effects of market volatilities on Huali Industrial and Tibet Huayu 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 Huali Industrial with a short position of Tibet Huayu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huali Industrial and Tibet Huayu.
Diversification Opportunities for Huali Industrial and Tibet Huayu
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Huali and Tibet is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Huali Industrial Group and Tibet Huayu Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tibet Huayu Mining and Huali 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 Huali Industrial Group are associated (or correlated) with Tibet Huayu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tibet Huayu Mining has no effect on the direction of Huali Industrial i.e., Huali Industrial and Tibet Huayu go up and down completely randomly.
Pair Corralation between Huali Industrial and Tibet Huayu
Assuming the 90 days trading horizon Huali Industrial Group is expected to generate 0.83 times more return on investment than Tibet Huayu. However, Huali Industrial Group is 1.21 times less risky than Tibet Huayu. It trades about 0.22 of its potential returns per unit of risk. Tibet Huayu Mining is currently generating about 0.1 per unit of risk. If you would invest 6,820 in Huali Industrial Group on September 13, 2024 and sell it today you would earn a total of 857.00 from holding Huali Industrial Group or generate 12.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Huali Industrial Group vs. Tibet Huayu Mining
Performance |
| Timeline |
| Huali Industrial |
| Tibet Huayu Mining |
Huali Industrial and Tibet Huayu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huali Industrial and Tibet Huayu
The main advantage of trading using opposite Huali Industrial and Tibet Huayu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huali Industrial position performs unexpectedly, Tibet Huayu 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 Tibet Huayu will offset losses from the drop in Tibet Huayu's long position.| Huali Industrial vs. Tibet Huayu Mining | Huali Industrial vs. Huaibei Mining Holdings | Huali Industrial vs. Chengtun Mining Group | Huali Industrial vs. Guocheng Mining Co |
| Tibet Huayu vs. Hangzhou Pinming Software | Tibet Huayu vs. Marssenger Kitchenware Co | Tibet Huayu vs. Qumei Furniture Group | Tibet Huayu vs. Vohringer Home Technology |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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