Correlation Between Weihai Honglin and Konfoong Materials
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By analyzing existing cross correlation between Weihai Honglin Electronic and Konfoong Materials International, you can compare the effects of market volatilities on Weihai Honglin and Konfoong Materials 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 Weihai Honglin with a short position of Konfoong Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weihai Honglin and Konfoong Materials.
Diversification Opportunities for Weihai Honglin and Konfoong Materials
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Weihai and Konfoong is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Weihai Honglin Electronic and Konfoong Materials Internation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Konfoong Materials and Weihai Honglin 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 Weihai Honglin Electronic are associated (or correlated) with Konfoong Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Konfoong Materials has no effect on the direction of Weihai Honglin i.e., Weihai Honglin and Konfoong Materials go up and down completely randomly.
Pair Corralation between Weihai Honglin and Konfoong Materials
Assuming the 90 days trading horizon Weihai Honglin Electronic is expected to generate 1.25 times more return on investment than Konfoong Materials. However, Weihai Honglin is 1.25 times more volatile than Konfoong Materials International. It trades about 0.22 of its potential returns per unit of risk. Konfoong Materials International is currently generating about -0.18 per unit of risk. If you would invest 1,399 in Weihai Honglin Electronic on October 10, 2024 and sell it today you would earn a total of 197.00 from holding Weihai Honglin Electronic or generate 14.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weihai Honglin Electronic vs. Konfoong Materials Internation
Performance |
| Timeline |
| Weihai Honglin Electronic |
| Konfoong Materials |
Weihai Honglin and Konfoong Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weihai Honglin and Konfoong Materials
The main advantage of trading using opposite Weihai Honglin and Konfoong Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weihai Honglin position performs unexpectedly, Konfoong Materials 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 Konfoong Materials will offset losses from the drop in Konfoong Materials' long position.| Weihai Honglin vs. GreenTech Environmental Co | Weihai Honglin vs. Grandblue Environment Co | Weihai Honglin vs. Xiandai Investment Co | Weihai Honglin vs. Fujian Nanwang Environment |
| Konfoong Materials vs. Penyao Environmental Protection | Konfoong Materials vs. Grandblue Environment Co | Konfoong Materials vs. Baoshan Iron Steel | Konfoong Materials vs. Guangdong Liantai Environmental |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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