Correlation Between Hua Xia and Cabio Biotech
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By analyzing existing cross correlation between Hua Xia Bank and Cabio Biotech Wuhan, you can compare the effects of market volatilities on Hua Xia and Cabio Biotech 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 Cabio Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hua Xia and Cabio Biotech.
Diversification Opportunities for Hua Xia and Cabio Biotech
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hua and Cabio is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Hua Xia Bank and Cabio Biotech Wuhan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cabio Biotech Wuhan 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 Cabio Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cabio Biotech Wuhan has no effect on the direction of Hua Xia i.e., Hua Xia and Cabio Biotech go up and down completely randomly.
Pair Corralation between Hua Xia and Cabio Biotech
Assuming the 90 days trading horizon Hua Xia Bank is expected to under-perform the Cabio Biotech. But the stock apears to be less risky and, when comparing its historical volatility, Hua Xia Bank is 2.19 times less risky than Cabio Biotech. The stock trades about -0.16 of its potential returns per unit of risk. The Cabio Biotech Wuhan is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 1,958 in Cabio Biotech Wuhan on October 23, 2024 and sell it today you would lose (23.00) from holding Cabio Biotech Wuhan or give up 1.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hua Xia Bank vs. Cabio Biotech Wuhan
Performance |
| Timeline |
| Hua Xia Bank |
| Cabio Biotech Wuhan |
Hua Xia and Cabio Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hua Xia and Cabio Biotech
The main advantage of trading using opposite Hua Xia and Cabio Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hua Xia position performs unexpectedly, Cabio Biotech 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 Cabio Biotech will offset losses from the drop in Cabio Biotech's long position.| Hua Xia vs. Chengtun Mining Group | Hua Xia vs. Markor International Home | Hua Xia vs. Uroica Mining Safety | Hua Xia vs. Guocheng Mining Co |
| Cabio Biotech vs. Jiangsu GDK Biotechnology | Cabio Biotech vs. Postal Savings Bank | Cabio Biotech vs. Hua Xia Bank | Cabio Biotech vs. Anhui Gujing Distillery |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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