Correlation Between Hua Xia and XiaMen HongXin
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By analyzing existing cross correlation between Hua Xia Bank and XiaMen HongXin Electron tech, you can compare the effects of market volatilities on Hua Xia and XiaMen HongXin 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 Hua Xia with a short position of XiaMen HongXin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hua Xia and XiaMen HongXin.
Diversification Opportunities for Hua Xia and XiaMen HongXin
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hua and XiaMen is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Hua Xia Bank and XiaMen HongXin Electron tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XiaMen HongXin Electron and Hua Xia 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 Hua Xia Bank are associated (or correlated) with XiaMen HongXin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XiaMen HongXin Electron has no effect on the direction of Hua Xia i.e., Hua Xia and XiaMen HongXin go up and down completely randomly.
Pair Corralation between Hua Xia and XiaMen HongXin
Assuming the 90 days trading horizon Hua Xia is expected to generate 2.29 times less return on investment than XiaMen HongXin. But when comparing it to its historical volatility, Hua Xia Bank is 2.38 times less risky than XiaMen HongXin. It trades about 0.08 of its potential returns per unit of risk. XiaMen HongXin Electron tech is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,501 in XiaMen HongXin Electron tech on October 18, 2024 and sell it today you would earn a total of 574.00 from holding XiaMen HongXin Electron tech or generate 38.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hua Xia Bank vs. XiaMen HongXin Electron tech
Performance |
| Timeline |
| Hua Xia Bank |
| XiaMen HongXin Electron |
Hua Xia and XiaMen HongXin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hua Xia and XiaMen HongXin
The main advantage of trading using opposite Hua Xia and XiaMen HongXin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hua Xia position performs unexpectedly, XiaMen HongXin 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 XiaMen HongXin will offset losses from the drop in XiaMen HongXin's long position.| Hua Xia vs. Qingdao Foods Co | Hua Xia vs. Beijing Sanyuan Foods | Hua Xia vs. Changjiang Publishing Media | Hua Xia vs. Ligao Foods CoLtd |
| XiaMen HongXin vs. Unisplendour Corp | XiaMen HongXin vs. Shenwu Energy Saving | XiaMen HongXin vs. Ping An Insurance | XiaMen HongXin vs. Hua Xia Bank |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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