Correlation Between Tonghua Grape and Hubei Xingfa
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By analyzing existing cross correlation between Tonghua Grape Wine and Hubei Xingfa Chemicals, you can compare the effects of market volatilities on Tonghua Grape and Hubei Xingfa 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 Hubei Xingfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tonghua Grape and Hubei Xingfa.
Diversification Opportunities for Tonghua Grape and Hubei Xingfa
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tonghua and Hubei is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Tonghua Grape Wine and Hubei Xingfa Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Xingfa Chemicals 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 Hubei Xingfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Xingfa Chemicals has no effect on the direction of Tonghua Grape i.e., Tonghua Grape and Hubei Xingfa go up and down completely randomly.
Pair Corralation between Tonghua Grape and Hubei Xingfa
Assuming the 90 days trading horizon Tonghua Grape Wine is expected to generate 1.15 times more return on investment than Hubei Xingfa. However, Tonghua Grape is 1.15 times more volatile than Hubei Xingfa Chemicals. It trades about -0.02 of its potential returns per unit of risk. Hubei Xingfa Chemicals is currently generating about -0.03 per unit of risk. If you would invest 385.00 in Tonghua Grape Wine on November 19, 2024 and sell it today you would lose (116.00) from holding Tonghua Grape Wine or give up 30.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tonghua Grape Wine vs. Hubei Xingfa Chemicals
Performance |
| Timeline |
| Tonghua Grape Wine |
| Hubei Xingfa Chemicals |
Tonghua Grape and Hubei Xingfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tonghua Grape and Hubei Xingfa
The main advantage of trading using opposite Tonghua Grape and Hubei Xingfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tonghua Grape position performs unexpectedly, Hubei Xingfa 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 Hubei Xingfa will offset losses from the drop in Hubei Xingfa's long position.| Tonghua Grape vs. Hefei Metalforming Mach | Tonghua Grape vs. Bomesc Offshore Engineering | Tonghua Grape vs. Sunny Loan Top | Tonghua Grape vs. Tongling Nonferrous Metals |
| Hubei Xingfa vs. Kontour Medical Technology | Hubei Xingfa vs. Shenzhen MYS Environmental | Hubei Xingfa vs. Suntar Environmental Technology | Hubei Xingfa vs. Nanjing Vishee Medical |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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