Correlation Between Harbin Air and Heilongjiang Transport
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By analyzing existing cross correlation between Harbin Air Conditioning and Heilongjiang Transport Development, you can compare the effects of market volatilities on Harbin Air and Heilongjiang Transport 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 Heilongjiang Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harbin Air and Heilongjiang Transport.
Diversification Opportunities for Harbin Air and Heilongjiang Transport
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Harbin and Heilongjiang is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Harbin Air Conditioning and Heilongjiang Transport Develop in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heilongjiang Transport 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 Heilongjiang Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heilongjiang Transport has no effect on the direction of Harbin Air i.e., Harbin Air and Heilongjiang Transport go up and down completely randomly.
Pair Corralation between Harbin Air and Heilongjiang Transport
Assuming the 90 days trading horizon Harbin Air is expected to generate 3.33 times less return on investment than Heilongjiang Transport. But when comparing it to its historical volatility, Harbin Air Conditioning is 1.14 times less risky than Heilongjiang Transport. It trades about 0.01 of its potential returns per unit of risk. Heilongjiang Transport Development is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 320.00 in Heilongjiang Transport Development on August 31, 2024 and sell it today you would earn a total of 69.00 from holding Heilongjiang Transport Development or generate 21.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harbin Air Conditioning vs. Heilongjiang Transport Develop
Performance |
| Timeline |
| Harbin Air Conditioning |
| Heilongjiang Transport |
Harbin Air and Heilongjiang Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harbin Air and Heilongjiang Transport
The main advantage of trading using opposite Harbin Air and Heilongjiang Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harbin Air position performs unexpectedly, Heilongjiang Transport 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 Heilongjiang Transport will offset losses from the drop in Heilongjiang Transport's long position.| Harbin Air vs. Cultural Investment Holdings | Harbin Air vs. Gome Telecom Equipment | Harbin Air vs. Bus Online Co | Harbin Air vs. Holitech Technology Co |
| Heilongjiang Transport vs. Cultural Investment Holdings | Heilongjiang Transport vs. Gome Telecom Equipment | Heilongjiang Transport vs. Bus Online Co | Heilongjiang Transport vs. Holitech Technology Co |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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