Correlation Between Harbin Hatou and Lingyuan Iron
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By analyzing existing cross correlation between Harbin Hatou Investment and Lingyuan Iron Steel, you can compare the effects of market volatilities on Harbin Hatou and Lingyuan Iron 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 Lingyuan Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harbin Hatou and Lingyuan Iron.
Diversification Opportunities for Harbin Hatou and Lingyuan Iron
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Harbin and Lingyuan is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Harbin Hatou Investment and Lingyuan Iron Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lingyuan Iron Steel 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 Lingyuan Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lingyuan Iron Steel has no effect on the direction of Harbin Hatou i.e., Harbin Hatou and Lingyuan Iron go up and down completely randomly.
Pair Corralation between Harbin Hatou and Lingyuan Iron
Assuming the 90 days trading horizon Harbin Hatou Investment is expected to generate 1.07 times more return on investment than Lingyuan Iron. However, Harbin Hatou is 1.07 times more volatile than Lingyuan Iron Steel. It trades about 0.05 of its potential returns per unit of risk. Lingyuan Iron Steel is currently generating about 0.02 per unit of risk. If you would invest 512.00 in Harbin Hatou Investment on November 1, 2024 and sell it today you would earn a total of 125.00 from holding Harbin Hatou Investment or generate 24.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harbin Hatou Investment vs. Lingyuan Iron Steel
Performance |
| Timeline |
| Harbin Hatou Investment |
| Lingyuan Iron Steel |
Harbin Hatou and Lingyuan Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harbin Hatou and Lingyuan Iron
The main advantage of trading using opposite Harbin Hatou and Lingyuan Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harbin Hatou position performs unexpectedly, Lingyuan Iron 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 Lingyuan Iron will offset losses from the drop in Lingyuan Iron's long position.| Harbin Hatou vs. Agricultural Bank of | Harbin Hatou vs. Industrial and Commercial | Harbin Hatou vs. Bank of China | Harbin Hatou vs. China Construction Bank |
| Lingyuan Iron vs. Uxi Unicomp Technology | Lingyuan Iron vs. Suzhou Industrial Park | Lingyuan Iron vs. Guangzhou KingTeller Technology | Lingyuan Iron vs. Montage Technology Co |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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