Correlation Between Hubei Xingfa and Shenzhen Noposion
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By analyzing existing cross correlation between Hubei Xingfa Chemicals and Shenzhen Noposion Agrochemicals, you can compare the effects of market volatilities on Hubei Xingfa and Shenzhen Noposion 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 Noposion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubei Xingfa and Shenzhen Noposion.
Diversification Opportunities for Hubei Xingfa and Shenzhen Noposion
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hubei and Shenzhen is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Hubei Xingfa Chemicals and Shenzhen Noposion Agrochemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Noposion 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 Noposion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Noposion has no effect on the direction of Hubei Xingfa i.e., Hubei Xingfa and Shenzhen Noposion go up and down completely randomly.
Pair Corralation between Hubei Xingfa and Shenzhen Noposion
Assuming the 90 days trading horizon Hubei Xingfa is expected to generate 2.37 times less return on investment than Shenzhen Noposion. In addition to that, Hubei Xingfa is 1.09 times more volatile than Shenzhen Noposion Agrochemicals. It trades about 0.03 of its total potential returns per unit of risk. Shenzhen Noposion Agrochemicals is currently generating about 0.08 per unit of volatility. If you would invest 913.00 in Shenzhen Noposion Agrochemicals on August 25, 2024 and sell it today you would earn a total of 36.00 from holding Shenzhen Noposion Agrochemicals or generate 3.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hubei Xingfa Chemicals vs. Shenzhen Noposion Agrochemical
Performance |
| Timeline |
| Hubei Xingfa Chemicals |
| Shenzhen Noposion |
Hubei Xingfa and Shenzhen Noposion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubei Xingfa and Shenzhen Noposion
The main advantage of trading using opposite Hubei Xingfa and Shenzhen Noposion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubei Xingfa position performs unexpectedly, Shenzhen Noposion 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 Noposion will offset losses from the drop in Shenzhen Noposion's long position.| Hubei Xingfa vs. Guangzhou Ruoyuchen Information | Hubei Xingfa vs. Northking Information Technology | Hubei Xingfa vs. Tonghua Grape Wine | Hubei Xingfa vs. Xiamen Goldenhome Co |
| Shenzhen Noposion vs. Tongyu Communication | Shenzhen Noposion vs. Holitech Technology Co | Shenzhen Noposion vs. Sunwave Communications Co | Shenzhen Noposion vs. Changchun UP Optotech |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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