Correlation Between Hubei Xingfa and Shenzhen Centralcon
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By analyzing existing cross correlation between Hubei Xingfa Chemicals and Shenzhen Centralcon Investment, you can compare the effects of market volatilities on Hubei Xingfa and Shenzhen Centralcon 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 Hubei Xingfa with a short position of Shenzhen Centralcon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubei Xingfa and Shenzhen Centralcon.
Diversification Opportunities for Hubei Xingfa and Shenzhen Centralcon
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hubei and Shenzhen is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Hubei Xingfa Chemicals and Shenzhen Centralcon Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Centralcon and Hubei Xingfa 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 Hubei Xingfa Chemicals are associated (or correlated) with Shenzhen Centralcon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Centralcon has no effect on the direction of Hubei Xingfa i.e., Hubei Xingfa and Shenzhen Centralcon go up and down completely randomly.
Pair Corralation between Hubei Xingfa and Shenzhen Centralcon
Assuming the 90 days trading horizon Hubei Xingfa Chemicals is expected to generate 0.89 times more return on investment than Shenzhen Centralcon. However, Hubei Xingfa Chemicals is 1.12 times less risky than Shenzhen Centralcon. It trades about -0.05 of its potential returns per unit of risk. Shenzhen Centralcon Investment is currently generating about -0.13 per unit of risk. If you would invest 2,213 in Hubei Xingfa Chemicals on October 28, 2024 and sell it today you would lose (49.00) from holding Hubei Xingfa Chemicals or give up 2.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hubei Xingfa Chemicals vs. Shenzhen Centralcon Investment
Performance |
| Timeline |
| Hubei Xingfa Chemicals |
| Shenzhen Centralcon |
Hubei Xingfa and Shenzhen Centralcon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubei Xingfa and Shenzhen Centralcon
The main advantage of trading using opposite Hubei Xingfa and Shenzhen Centralcon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubei Xingfa position performs unexpectedly, Shenzhen Centralcon 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 Shenzhen Centralcon will offset losses from the drop in Shenzhen Centralcon's long position.| Hubei Xingfa vs. Great Sun Foods Co | Hubei Xingfa vs. Heilongjiang Transport Development | Hubei Xingfa vs. Qingdao Foods Co | Hubei Xingfa vs. Sichuan Fulin Transportation |
| Shenzhen Centralcon vs. CICT Mobile Communication | Shenzhen Centralcon vs. Luyin Investment Group | Shenzhen Centralcon vs. Xiandai Investment Co | Shenzhen Centralcon vs. Guangzhou Haige Communications |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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