Correlation Between Hubei Xingfa and Industrial Securities
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By analyzing existing cross correlation between Hubei Xingfa Chemicals and Industrial Securities Co, you can compare the effects of market volatilities on Hubei Xingfa and Industrial Securities 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 Industrial Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubei Xingfa and Industrial Securities.
Diversification Opportunities for Hubei Xingfa and Industrial Securities
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hubei and Industrial is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Hubei Xingfa Chemicals and Industrial Securities Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial Securities 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 Industrial Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial Securities has no effect on the direction of Hubei Xingfa i.e., Hubei Xingfa and Industrial Securities go up and down completely randomly.
Pair Corralation between Hubei Xingfa and Industrial Securities
Assuming the 90 days trading horizon Hubei Xingfa Chemicals is expected to generate 0.68 times more return on investment than Industrial Securities. However, Hubei Xingfa Chemicals is 1.48 times less risky than Industrial Securities. It trades about -0.3 of its potential returns per unit of risk. Industrial Securities Co is currently generating about -0.31 per unit of risk. If you would invest 2,296 in Hubei Xingfa Chemicals on October 7, 2024 and sell it today you would lose (158.00) from holding Hubei Xingfa Chemicals or give up 6.88% 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. Industrial Securities Co
Performance |
| Timeline |
| Hubei Xingfa Chemicals |
| Industrial Securities |
Hubei Xingfa and Industrial Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubei Xingfa and Industrial Securities
The main advantage of trading using opposite Hubei Xingfa and Industrial Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubei Xingfa position performs unexpectedly, Industrial Securities 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 Industrial Securities will offset losses from the drop in Industrial Securities' long position.| Hubei Xingfa vs. Zijin Mining Group | Hubei Xingfa vs. Wanhua Chemical Group | Hubei Xingfa vs. Baoshan Iron Steel | Hubei Xingfa vs. Hoshine Silicon Ind |
| Industrial Securities vs. Jiangnan Mould Plastic | Industrial Securities vs. Tieling Newcity Investment | Industrial Securities vs. Harbin Hatou Investment | Industrial Securities vs. Vanfund Urban Investment |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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