Correlation Between State Grid and Hengdian Entertainment
Specify exactly 2 symbols:
By analyzing existing cross correlation between State Grid InformationCommunication and Hengdian Entertainment Co, you can compare the effects of market volatilities on State Grid and Hengdian Entertainment 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 State Grid with a short position of Hengdian Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Grid and Hengdian Entertainment.
Diversification Opportunities for State Grid and Hengdian Entertainment
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between State and Hengdian is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding State Grid InformationCommunic and Hengdian Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hengdian Entertainment and State Grid 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 State Grid InformationCommunication are associated (or correlated) with Hengdian Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hengdian Entertainment has no effect on the direction of State Grid i.e., State Grid and Hengdian Entertainment go up and down completely randomly.
Pair Corralation between State Grid and Hengdian Entertainment
Assuming the 90 days trading horizon State Grid InformationCommunication is expected to generate 0.86 times more return on investment than Hengdian Entertainment. However, State Grid InformationCommunication is 1.17 times less risky than Hengdian Entertainment. It trades about 0.02 of its potential returns per unit of risk. Hengdian Entertainment Co is currently generating about 0.01 per unit of risk. If you would invest 1,700 in State Grid InformationCommunication on October 16, 2024 and sell it today you would earn a total of 118.00 from holding State Grid InformationCommunication or generate 6.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
State Grid InformationCommunic vs. Hengdian Entertainment Co
Performance |
| Timeline |
| State Grid Informati |
| Hengdian Entertainment |
State Grid and Hengdian Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Grid and Hengdian Entertainment
The main advantage of trading using opposite State Grid and Hengdian Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State Grid position performs unexpectedly, Hengdian Entertainment 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 Hengdian Entertainment will offset losses from the drop in Hengdian Entertainment's long position.| State Grid vs. Beijing Yanjing Brewery | State Grid vs. Everjoy Health Group | State Grid vs. Hangzhou Minsheng Healthcare | State Grid vs. Sanxiang Advanced Materials |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |