Correlation Between Tibet Huayu and New Hope
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By analyzing existing cross correlation between Tibet Huayu Mining and New Hope Dairy, you can compare the effects of market volatilities on Tibet Huayu and New Hope 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 Tibet Huayu with a short position of New Hope. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tibet Huayu and New Hope.
Diversification Opportunities for Tibet Huayu and New Hope
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Tibet and New is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Tibet Huayu Mining and New Hope Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Hope Dairy and Tibet Huayu 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 Tibet Huayu Mining are associated (or correlated) with New Hope. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Hope Dairy has no effect on the direction of Tibet Huayu i.e., Tibet Huayu and New Hope go up and down completely randomly.
Pair Corralation between Tibet Huayu and New Hope
Assuming the 90 days trading horizon Tibet Huayu Mining is expected to under-perform the New Hope. But the stock apears to be less risky and, when comparing its historical volatility, Tibet Huayu Mining is 1.54 times less risky than New Hope. The stock trades about -0.49 of its potential returns per unit of risk. The New Hope Dairy is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,532 in New Hope Dairy on October 14, 2024 and sell it today you would earn a total of 41.00 from holding New Hope Dairy or generate 2.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tibet Huayu Mining vs. New Hope Dairy
Performance |
| Timeline |
| Tibet Huayu Mining |
| New Hope Dairy |
Tibet Huayu and New Hope Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tibet Huayu and New Hope
The main advantage of trading using opposite Tibet Huayu and New Hope positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tibet Huayu position performs unexpectedly, New Hope 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 New Hope will offset losses from the drop in New Hope's long position.| Tibet Huayu vs. Zijin Mining Group | Tibet Huayu vs. Wanhua Chemical Group | Tibet Huayu vs. Baoshan Iron Steel | Tibet Huayu vs. Shandong Gold Mining |
| New Hope vs. Fibocom Wireless | New Hope vs. Guangzhou Haige Communications | New Hope vs. Songz Automobile Air | New Hope 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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