Correlation Between Cultural Investment and Wuhan Hvsen
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By analyzing existing cross correlation between Cultural Investment Holdings and Wuhan Hvsen Biotechnology, you can compare the effects of market volatilities on Cultural Investment and Wuhan Hvsen 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 Cultural Investment with a short position of Wuhan Hvsen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cultural Investment and Wuhan Hvsen.
Diversification Opportunities for Cultural Investment and Wuhan Hvsen
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cultural and Wuhan is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Cultural Investment Holdings and Wuhan Hvsen Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wuhan Hvsen Biotechnology and Cultural Investment 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 Cultural Investment Holdings are associated (or correlated) with Wuhan Hvsen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wuhan Hvsen Biotechnology has no effect on the direction of Cultural Investment i.e., Cultural Investment and Wuhan Hvsen go up and down completely randomly.
Pair Corralation between Cultural Investment and Wuhan Hvsen
Assuming the 90 days trading horizon Cultural Investment Holdings is expected to under-perform the Wuhan Hvsen. But the stock apears to be less risky and, when comparing its historical volatility, Cultural Investment Holdings is 1.79 times less risky than Wuhan Hvsen. The stock trades about -0.13 of its potential returns per unit of risk. The Wuhan Hvsen Biotechnology is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,003 in Wuhan Hvsen Biotechnology on November 3, 2024 and sell it today you would earn a total of 34.00 from holding Wuhan Hvsen Biotechnology or generate 3.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cultural Investment Holdings vs. Wuhan Hvsen Biotechnology
Performance |
| Timeline |
| Cultural Investment |
| Wuhan Hvsen Biotechnology |
Cultural Investment and Wuhan Hvsen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cultural Investment and Wuhan Hvsen
The main advantage of trading using opposite Cultural Investment and Wuhan Hvsen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cultural Investment position performs unexpectedly, Wuhan Hvsen 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 Wuhan Hvsen will offset losses from the drop in Wuhan Hvsen's long position.The idea behind Cultural Investment Holdings and Wuhan Hvsen Biotechnology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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