Correlation Between Harbin Hatou and Xinjiang Communications
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By analyzing existing cross correlation between Harbin Hatou Investment and Xinjiang Communications Construction, you can compare the effects of market volatilities on Harbin Hatou and Xinjiang Communications 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 Xinjiang Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harbin Hatou and Xinjiang Communications.
Diversification Opportunities for Harbin Hatou and Xinjiang Communications
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Harbin and Xinjiang is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Harbin Hatou Investment and Xinjiang Communications Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Communications 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 Xinjiang Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Communications has no effect on the direction of Harbin Hatou i.e., Harbin Hatou and Xinjiang Communications go up and down completely randomly.
Pair Corralation between Harbin Hatou and Xinjiang Communications
Assuming the 90 days trading horizon Harbin Hatou Investment is expected to under-perform the Xinjiang Communications. In addition to that, Harbin Hatou is 1.36 times more volatile than Xinjiang Communications Construction. It trades about -0.23 of its total potential returns per unit of risk. Xinjiang Communications Construction is currently generating about -0.25 per unit of volatility. If you would invest 1,201 in Xinjiang Communications Construction on October 24, 2024 and sell it today you would lose (138.00) from holding Xinjiang Communications Construction or give up 11.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harbin Hatou Investment vs. Xinjiang Communications Constr
Performance |
| Timeline |
| Harbin Hatou Investment |
| Xinjiang Communications |
Harbin Hatou and Xinjiang Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harbin Hatou and Xinjiang Communications
The main advantage of trading using opposite Harbin Hatou and Xinjiang Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harbin Hatou position performs unexpectedly, Xinjiang Communications 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 Xinjiang Communications will offset losses from the drop in Xinjiang Communications' long position.| Harbin Hatou vs. Hubei Geoway Investment | Harbin Hatou vs. Jointo Energy Investment | Harbin Hatou vs. China Sports Industry | Harbin Hatou vs. Sportsoul Co Ltd |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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