Correlation Between Tonghua Grape and New Hope
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By analyzing existing cross correlation between Tonghua Grape Wine and New Hope Dairy, you can compare the effects of market volatilities on Tonghua Grape and New Hope 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 Tonghua Grape with a short position of New Hope. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tonghua Grape and New Hope.
Diversification Opportunities for Tonghua Grape and New Hope
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Tonghua and New is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Tonghua Grape Wine and New Hope Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Hope Dairy and Tonghua Grape 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 Tonghua Grape Wine are associated (or correlated) with New Hope. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Hope Dairy has no effect on the direction of Tonghua Grape i.e., Tonghua Grape and New Hope go up and down completely randomly.
Pair Corralation between Tonghua Grape and New Hope
Assuming the 90 days trading horizon Tonghua Grape Wine is expected to under-perform the New Hope. In addition to that, Tonghua Grape is 1.05 times more volatile than New Hope Dairy. It trades about -0.31 of its total potential returns per unit of risk. New Hope Dairy is currently generating about 0.19 per unit of volatility. If you would invest 1,421 in New Hope Dairy on October 23, 2024 and sell it today you would earn a total of 122.00 from holding New Hope Dairy or generate 8.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tonghua Grape Wine vs. New Hope Dairy
Performance |
| Timeline |
| Tonghua Grape Wine |
| New Hope Dairy |
Tonghua Grape and New Hope Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tonghua Grape and New Hope
The main advantage of trading using opposite Tonghua Grape and New Hope positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tonghua Grape position performs unexpectedly, New Hope 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 New Hope will offset losses from the drop in New Hope's long position.| Tonghua Grape vs. Heilongjiang Transport Development | Tonghua Grape vs. Sichuan Fulin Transportation | Tonghua Grape vs. Nanjing OLO Home | Tonghua Grape vs. Gansu Huangtai Wine marketing |
| New Hope vs. Tongyu Communication | New Hope vs. Shenzhen Noposion Agrochemicals | New Hope vs. Dymatic Chemicals | New Hope vs. Jilin Jlu Communication |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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