Correlation Between Hubei Xingfa and Epoxy Base
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By analyzing existing cross correlation between Hubei Xingfa Chemicals and Epoxy Base Electronic, you can compare the effects of market volatilities on Hubei Xingfa and Epoxy Base 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 Epoxy Base. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubei Xingfa and Epoxy Base.
Diversification Opportunities for Hubei Xingfa and Epoxy Base
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hubei and Epoxy is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Hubei Xingfa Chemicals and Epoxy Base Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Epoxy Base Electronic 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 Epoxy Base. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Epoxy Base Electronic has no effect on the direction of Hubei Xingfa i.e., Hubei Xingfa and Epoxy Base go up and down completely randomly.
Pair Corralation between Hubei Xingfa and Epoxy Base
Assuming the 90 days trading horizon Hubei Xingfa Chemicals is expected to generate 0.59 times more return on investment than Epoxy Base. However, Hubei Xingfa Chemicals is 1.7 times less risky than Epoxy Base. It trades about 0.04 of its potential returns per unit of risk. Epoxy Base Electronic is currently generating about 0.02 per unit of risk. If you would invest 1,965 in Hubei Xingfa Chemicals on August 26, 2024 and sell it today you would earn a total of 322.00 from holding Hubei Xingfa Chemicals or generate 16.39% 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. Epoxy Base Electronic
Performance |
| Timeline |
| Hubei Xingfa Chemicals |
| Epoxy Base Electronic |
Hubei Xingfa and Epoxy Base Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubei Xingfa and Epoxy Base
The main advantage of trading using opposite Hubei Xingfa and Epoxy Base positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubei Xingfa position performs unexpectedly, Epoxy Base 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 Epoxy Base will offset losses from the drop in Epoxy Base's long position.| Hubei Xingfa vs. Huaibei Mining Holdings | Hubei Xingfa vs. Guocheng Mining Co | Hubei Xingfa vs. Shandong Mining Machinery | Hubei Xingfa vs. Peoples Insurance of |
| Epoxy Base vs. Zijin Mining Group | Epoxy Base vs. Wanhua Chemical Group | Epoxy Base vs. Baoshan Iron Steel | Epoxy Base vs. Shandong Gold Mining |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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