Correlation Between Keda Clean and Hubei Xingfa
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By analyzing existing cross correlation between Keda Clean Energy and Hubei Xingfa Chemicals, you can compare the effects of market volatilities on Keda Clean 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 Keda Clean with a short position of Hubei Xingfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keda Clean and Hubei Xingfa.
Diversification Opportunities for Keda Clean and Hubei Xingfa
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Keda and Hubei is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Keda Clean Energy 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 Keda Clean 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 Keda Clean Energy 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 Keda Clean i.e., Keda Clean and Hubei Xingfa go up and down completely randomly.
Pair Corralation between Keda Clean and Hubei Xingfa
Assuming the 90 days trading horizon Keda Clean Energy is expected to generate 1.26 times more return on investment than Hubei Xingfa. However, Keda Clean is 1.26 times more volatile than Hubei Xingfa Chemicals. It trades about -0.06 of its potential returns per unit of risk. Hubei Xingfa Chemicals is currently generating about -0.34 per unit of risk. If you would invest 814.00 in Keda Clean Energy on October 14, 2024 and sell it today you would lose (16.00) from holding Keda Clean Energy or give up 1.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keda Clean Energy vs. Hubei Xingfa Chemicals
Performance |
| Timeline |
| Keda Clean Energy |
| Hubei Xingfa Chemicals |
Keda Clean and Hubei Xingfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keda Clean and Hubei Xingfa
The main advantage of trading using opposite Keda Clean and Hubei Xingfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keda Clean 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.| Keda Clean vs. Dr Peng Telecom | Keda Clean vs. Guangdong Shenglu Telecommunication | Keda Clean vs. Shaanxi Meineng Clean | Keda Clean vs. Fuda Alloy Materials |
| Hubei Xingfa vs. Keda Clean Energy | Hubei Xingfa vs. Shenzhen Zhongzhuang Construction | Hubei Xingfa vs. Nanxing Furniture Machinery | Hubei Xingfa vs. Shaanxi Meineng Clean |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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