Correlation Between Huafa Industrial and Huatian Hotel
Specify exactly 2 symbols:
By analyzing existing cross correlation between Huafa Industrial Co and Huatian Hotel Group, you can compare the effects of market volatilities on Huafa Industrial and Huatian Hotel 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 Huafa Industrial with a short position of Huatian Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huafa Industrial and Huatian Hotel.
Diversification Opportunities for Huafa Industrial and Huatian Hotel
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Huafa and Huatian is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Huafa Industrial Co and Huatian Hotel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huatian Hotel Group and Huafa Industrial 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 Huafa Industrial Co are associated (or correlated) with Huatian Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huatian Hotel Group has no effect on the direction of Huafa Industrial i.e., Huafa Industrial and Huatian Hotel go up and down completely randomly.
Pair Corralation between Huafa Industrial and Huatian Hotel
Assuming the 90 days trading horizon Huafa Industrial Co is expected to under-perform the Huatian Hotel. But the stock apears to be less risky and, when comparing its historical volatility, Huafa Industrial Co is 1.62 times less risky than Huatian Hotel. The stock trades about -0.07 of its potential returns per unit of risk. The Huatian Hotel Group is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 348.00 in Huatian Hotel Group on September 2, 2024 and sell it today you would lose (1.00) from holding Huatian Hotel Group or give up 0.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huafa Industrial Co vs. Huatian Hotel Group
Performance |
| Timeline |
| Huafa Industrial |
| Huatian Hotel Group |
Huafa Industrial and Huatian Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huafa Industrial and Huatian Hotel
The main advantage of trading using opposite Huafa Industrial and Huatian Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huafa Industrial position performs unexpectedly, Huatian Hotel 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 Huatian Hotel will offset losses from the drop in Huatian Hotel's long position.| Huafa Industrial vs. Ningbo Fangzheng Automobile | Huafa Industrial vs. Anhui Jianghuai Automobile | Huafa Industrial vs. Jinhe Biotechnology Co | Huafa Industrial vs. Guangzhou KingTeller Technology |
| Huatian Hotel vs. Lotus Health Group | Huatian Hotel vs. Zhuhai Comleader Information | Huatian Hotel vs. Yunnan Jianzhijia Health Chain | Huatian Hotel vs. Longmaster Information Tech |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |