Correlation Between Huafa Industrial and Duzhe Publishing
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By analyzing existing cross correlation between Huafa Industrial Co and Duzhe Publishing Media, you can compare the effects of market volatilities on Huafa Industrial and Duzhe Publishing 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 Duzhe Publishing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huafa Industrial and Duzhe Publishing.
Diversification Opportunities for Huafa Industrial and Duzhe Publishing
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Huafa and Duzhe is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Huafa Industrial Co and Duzhe Publishing Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duzhe Publishing Media 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 Duzhe Publishing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duzhe Publishing Media has no effect on the direction of Huafa Industrial i.e., Huafa Industrial and Duzhe Publishing go up and down completely randomly.
Pair Corralation between Huafa Industrial and Duzhe Publishing
Assuming the 90 days trading horizon Huafa Industrial is expected to generate 1.63 times less return on investment than Duzhe Publishing. But when comparing it to its historical volatility, Huafa Industrial Co is 1.04 times less risky than Duzhe Publishing. It trades about 0.02 of its potential returns per unit of risk. Duzhe Publishing Media is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 582.00 in Duzhe Publishing Media on August 29, 2024 and sell it today you would earn a total of 36.00 from holding Duzhe Publishing Media or generate 6.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huafa Industrial Co vs. Duzhe Publishing Media
Performance |
| Timeline |
| Huafa Industrial |
| Duzhe Publishing Media |
Huafa Industrial and Duzhe Publishing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huafa Industrial and Duzhe Publishing
The main advantage of trading using opposite Huafa Industrial and Duzhe Publishing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huafa Industrial position performs unexpectedly, Duzhe Publishing 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 Duzhe Publishing will offset losses from the drop in Duzhe Publishing's long position.| Huafa Industrial vs. Cambricon Technologies Corp | Huafa Industrial vs. Empyrean Technology Co | Huafa Industrial vs. Kuang Chi Technologies | Huafa Industrial vs. Gansu Jiu Steel |
| Duzhe Publishing vs. Industrial and Commercial | Duzhe Publishing vs. Agricultural Bank of | Duzhe Publishing vs. China Construction Bank | Duzhe Publishing vs. Bank of China |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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