Correlation Between Hengli Petrochemical and Eastroc Beverage
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By analyzing existing cross correlation between Hengli Petrochemical Co and Eastroc Beverage Group, you can compare the effects of market volatilities on Hengli Petrochemical and Eastroc Beverage 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 Hengli Petrochemical with a short position of Eastroc Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hengli Petrochemical and Eastroc Beverage.
Diversification Opportunities for Hengli Petrochemical and Eastroc Beverage
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hengli and Eastroc is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Hengli Petrochemical Co and Eastroc Beverage Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastroc Beverage and Hengli Petrochemical 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 Hengli Petrochemical Co are associated (or correlated) with Eastroc Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastroc Beverage has no effect on the direction of Hengli Petrochemical i.e., Hengli Petrochemical and Eastroc Beverage go up and down completely randomly.
Pair Corralation between Hengli Petrochemical and Eastroc Beverage
Assuming the 90 days trading horizon Hengli Petrochemical Co is expected to generate 0.28 times more return on investment than Eastroc Beverage. However, Hengli Petrochemical Co is 3.55 times less risky than Eastroc Beverage. It trades about -0.01 of its potential returns per unit of risk. Eastroc Beverage Group is currently generating about -0.05 per unit of risk. If you would invest 1,502 in Hengli Petrochemical Co on November 5, 2024 and sell it today you would lose (4.00) from holding Hengli Petrochemical Co or give up 0.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hengli Petrochemical Co vs. Eastroc Beverage Group
Performance |
| Timeline |
| Hengli Petrochemical |
| Eastroc Beverage |
Hengli Petrochemical and Eastroc Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hengli Petrochemical and Eastroc Beverage
The main advantage of trading using opposite Hengli Petrochemical and Eastroc Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hengli Petrochemical position performs unexpectedly, Eastroc Beverage 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 Eastroc Beverage will offset losses from the drop in Eastroc Beverage's long position.| Hengli Petrochemical vs. Suzhou Douson Drilling | Hengli Petrochemical vs. Tjk Machinery Tianjin | Hengli Petrochemical vs. Sinomach General Machinery | Hengli Petrochemical vs. Sublime China Information |
| Eastroc Beverage vs. Nanjing OLO Home | Eastroc Beverage vs. TongFu Microelectronics Co | Eastroc Beverage vs. Queclink Wireless Solutions | Eastroc Beverage vs. Zhangjiagang Elegant Home |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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