Correlation Between Hua Xia and Nanning Chemical
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By analyzing existing cross correlation between Hua Xia Bank and Nanning Chemical Industry, you can compare the effects of market volatilities on Hua Xia and Nanning Chemical 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 Nanning Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hua Xia and Nanning Chemical.
Diversification Opportunities for Hua Xia and Nanning Chemical
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hua and Nanning is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Hua Xia Bank and Nanning Chemical Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanning Chemical Industry 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 Nanning Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanning Chemical Industry has no effect on the direction of Hua Xia i.e., Hua Xia and Nanning Chemical go up and down completely randomly.
Pair Corralation between Hua Xia and Nanning Chemical
Assuming the 90 days trading horizon Hua Xia is expected to generate 1.71 times less return on investment than Nanning Chemical. But when comparing it to its historical volatility, Hua Xia Bank is 2.19 times less risky than Nanning Chemical. It trades about 0.07 of its potential returns per unit of risk. Nanning Chemical Industry is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,234 in Nanning Chemical Industry on November 5, 2024 and sell it today you would earn a total of 528.00 from holding Nanning Chemical Industry or generate 42.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hua Xia Bank vs. Nanning Chemical Industry
Performance |
| Timeline |
| Hua Xia Bank |
| Nanning Chemical Industry |
Hua Xia and Nanning Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hua Xia and Nanning Chemical
The main advantage of trading using opposite Hua Xia and Nanning Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hua Xia position performs unexpectedly, Nanning Chemical 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 Nanning Chemical will offset losses from the drop in Nanning Chemical's long position.| Hua Xia vs. Gifore Agricultural Machinery | Hua Xia vs. Ningbo Construction Co | Hua Xia vs. Sinomach General Machinery | Hua Xia vs. Baoding Dongli Machinery |
| Nanning Chemical vs. Sichuan Hebang Biotechnology | Nanning Chemical vs. Guangdong Marubi Biotechnology | Nanning Chemical vs. Iat Automobile Technology | Nanning Chemical vs. Bloomage Biotechnology Corp |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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