Correlation Between Harbin Hatou and Anhui Huilong
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By analyzing existing cross correlation between Harbin Hatou Investment and Anhui Huilong Agricultural, you can compare the effects of market volatilities on Harbin Hatou and Anhui Huilong 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 Harbin Hatou with a short position of Anhui Huilong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harbin Hatou and Anhui Huilong.
Diversification Opportunities for Harbin Hatou and Anhui Huilong
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Harbin and Anhui is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Harbin Hatou Investment and Anhui Huilong Agricultural in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Huilong Agricu and Harbin Hatou 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 Harbin Hatou Investment are associated (or correlated) with Anhui Huilong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Huilong Agricu has no effect on the direction of Harbin Hatou i.e., Harbin Hatou and Anhui Huilong go up and down completely randomly.
Pair Corralation between Harbin Hatou and Anhui Huilong
Assuming the 90 days trading horizon Harbin Hatou is expected to generate 1.12 times less return on investment than Anhui Huilong. In addition to that, Harbin Hatou is 1.42 times more volatile than Anhui Huilong Agricultural. It trades about 0.08 of its total potential returns per unit of risk. Anhui Huilong Agricultural is currently generating about 0.13 per unit of volatility. If you would invest 530.00 in Anhui Huilong Agricultural on November 8, 2024 and sell it today you would earn a total of 16.00 from holding Anhui Huilong Agricultural or generate 3.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
Harbin Hatou Investment vs. Anhui Huilong Agricultural
Performance |
| Timeline |
| Harbin Hatou Investment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Anhui Huilong Agricu |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Harbin Hatou and Anhui Huilong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harbin Hatou and Anhui Huilong
The main advantage of trading using opposite Harbin Hatou and Anhui Huilong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harbin Hatou position performs unexpectedly, Anhui Huilong 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 Anhui Huilong will offset losses from the drop in Anhui Huilong's long position.The idea behind Harbin Hatou Investment and Anhui Huilong Agricultural 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.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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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