Correlation Between Tibet Huayu and Huali Industrial
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By analyzing existing cross correlation between Tibet Huayu Mining and Huali Industrial Group, you can compare the effects of market volatilities on Tibet Huayu and Huali Industrial 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 Huali Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tibet Huayu and Huali Industrial.
Diversification Opportunities for Tibet Huayu and Huali Industrial
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tibet and Huali is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Tibet Huayu Mining and Huali Industrial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huali Industrial 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 Huali Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huali Industrial has no effect on the direction of Tibet Huayu i.e., Tibet Huayu and Huali Industrial go up and down completely randomly.
Pair Corralation between Tibet Huayu and Huali Industrial
Assuming the 90 days trading horizon Tibet Huayu is expected to generate 1.95 times less return on investment than Huali Industrial. In addition to that, Tibet Huayu is 1.2 times more volatile than Huali Industrial Group. It trades about 0.09 of its total potential returns per unit of risk. Huali Industrial Group is currently generating about 0.21 per unit of volatility. If you would invest 6,826 in Huali Industrial Group on September 14, 2024 and sell it today you would earn a total of 825.00 from holding Huali Industrial Group or generate 12.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Tibet Huayu Mining vs. Huali Industrial Group
Performance |
| Timeline |
| Tibet Huayu Mining |
| Huali Industrial |
Tibet Huayu and Huali Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tibet Huayu and Huali Industrial
The main advantage of trading using opposite Tibet Huayu and Huali Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tibet Huayu position performs unexpectedly, Huali Industrial 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 Huali Industrial will offset losses from the drop in Huali Industrial'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 |
| Huali Industrial vs. Industrial and Commercial | Huali Industrial vs. Agricultural Bank of | Huali Industrial vs. China Construction Bank | Huali Industrial vs. Bank of China |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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