Correlation Between Harbin Air and Xinjiang Communications
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By analyzing existing cross correlation between Harbin Air Conditioning and Xinjiang Communications Construction, you can compare the effects of market volatilities on Harbin Air and Xinjiang Communications 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 Harbin Air with a short position of Xinjiang Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harbin Air and Xinjiang Communications.
Diversification Opportunities for Harbin Air and Xinjiang Communications
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Harbin and Xinjiang is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Harbin Air Conditioning and Xinjiang Communications Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Communications and Harbin Air 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 Harbin Air Conditioning are associated (or correlated) with Xinjiang Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Communications has no effect on the direction of Harbin Air i.e., Harbin Air and Xinjiang Communications go up and down completely randomly.
Pair Corralation between Harbin Air and Xinjiang Communications
Assuming the 90 days trading horizon Harbin Air Conditioning is expected to generate 2.19 times more return on investment than Xinjiang Communications. However, Harbin Air is 2.19 times more volatile than Xinjiang Communications Construction. It trades about -0.06 of its potential returns per unit of risk. Xinjiang Communications Construction is currently generating about -0.2 per unit of risk. If you would invest 516.00 in Harbin Air Conditioning on November 3, 2024 and sell it today you would lose (70.00) from holding Harbin Air Conditioning or give up 13.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harbin Air Conditioning vs. Xinjiang Communications Constr
Performance |
| Timeline |
| Harbin Air Conditioning |
| Xinjiang Communications |
Harbin Air and Xinjiang Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harbin Air and Xinjiang Communications
The main advantage of trading using opposite Harbin Air and Xinjiang Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harbin Air position performs unexpectedly, Xinjiang Communications 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 Xinjiang Communications will offset losses from the drop in Xinjiang Communications' long position.| Harbin Air vs. Anhui Jinhe Industrial | Harbin Air vs. Western Metal Materials | Harbin Air vs. Guangzhou Dongfang Hotel | Harbin Air vs. SSAW Hotels Resorts |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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