Correlation Between Hunan Tyen and Long Yuan
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By analyzing existing cross correlation between Hunan Tyen Machinery and Long Yuan Construction, you can compare the effects of market volatilities on Hunan Tyen and Long Yuan 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 Hunan Tyen with a short position of Long Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunan Tyen and Long Yuan.
Diversification Opportunities for Hunan Tyen and Long Yuan
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hunan and Long is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Hunan Tyen Machinery and Long Yuan Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Long Yuan Construction and Hunan Tyen 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 Hunan Tyen Machinery are associated (or correlated) with Long Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Long Yuan Construction has no effect on the direction of Hunan Tyen i.e., Hunan Tyen and Long Yuan go up and down completely randomly.
Pair Corralation between Hunan Tyen and Long Yuan
Assuming the 90 days trading horizon Hunan Tyen Machinery is expected to generate 1.17 times more return on investment than Long Yuan. However, Hunan Tyen is 1.17 times more volatile than Long Yuan Construction. It trades about 0.03 of its potential returns per unit of risk. Long Yuan Construction is currently generating about 0.0 per unit of risk. If you would invest 436.00 in Hunan Tyen Machinery on August 25, 2024 and sell it today you would earn a total of 74.00 from holding Hunan Tyen Machinery or generate 16.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hunan Tyen Machinery vs. Long Yuan Construction
Performance |
| Timeline |
| Hunan Tyen Machinery |
| Long Yuan Construction |
Hunan Tyen and Long Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hunan Tyen and Long Yuan
The main advantage of trading using opposite Hunan Tyen and Long Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunan Tyen position performs unexpectedly, Long Yuan 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 Long Yuan will offset losses from the drop in Long Yuan's long position.| Hunan Tyen vs. Kweichow Moutai Co | Hunan Tyen vs. Contemporary Amperex Technology | Hunan Tyen vs. G bits Network Technology | Hunan Tyen vs. Beijing Roborock Technology |
| Long Yuan vs. Iat Automobile Technology | Long Yuan vs. Masterwork Machinery | Long Yuan vs. Tjk Machinery Tianjin | Long Yuan vs. Hongrun Construction Group |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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