Correlation Between China Merchants and HUANLEJIA Food
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By analyzing existing cross correlation between China Merchants Bank and HUANLEJIA Food Group, you can compare the effects of market volatilities on China Merchants and HUANLEJIA Food 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 China Merchants with a short position of HUANLEJIA Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Merchants and HUANLEJIA Food.
Diversification Opportunities for China Merchants and HUANLEJIA Food
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and HUANLEJIA is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding China Merchants Bank and HUANLEJIA Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUANLEJIA Food Group and China Merchants 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 China Merchants Bank are associated (or correlated) with HUANLEJIA Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HUANLEJIA Food Group has no effect on the direction of China Merchants i.e., China Merchants and HUANLEJIA Food go up and down completely randomly.
Pair Corralation between China Merchants and HUANLEJIA Food
Assuming the 90 days trading horizon China Merchants Bank is expected to under-perform the HUANLEJIA Food. But the stock apears to be less risky and, when comparing its historical volatility, China Merchants Bank is 5.95 times less risky than HUANLEJIA Food. The stock trades about -0.23 of its potential returns per unit of risk. The HUANLEJIA Food Group is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 1,285 in HUANLEJIA Food Group on September 4, 2024 and sell it today you would earn a total of 924.00 from holding HUANLEJIA Food Group or generate 71.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Merchants Bank vs. HUANLEJIA Food Group
Performance |
| Timeline |
| China Merchants Bank |
| HUANLEJIA Food Group |
China Merchants and HUANLEJIA Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Merchants and HUANLEJIA Food
The main advantage of trading using opposite China Merchants and HUANLEJIA Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Merchants position performs unexpectedly, HUANLEJIA Food 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 HUANLEJIA Food will offset losses from the drop in HUANLEJIA Food's long position.| China Merchants vs. Dymatic Chemicals | China Merchants vs. JCHX Mining Management | China Merchants vs. Zijin Mining Group | China Merchants vs. Jinhui Mining Co |
| HUANLEJIA Food vs. China Mobile Limited | HUANLEJIA Food vs. Agricultural Bank of | HUANLEJIA Food vs. Industrial and Commercial | HUANLEJIA Food vs. China State Construction |
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 CEOs Directory module to screen CEOs from public companies around the world.
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