Correlation Between Tibet Huayu and Nantong Haixing
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By analyzing existing cross correlation between Tibet Huayu Mining and Nantong Haixing Electronics, you can compare the effects of market volatilities on Tibet Huayu and Nantong Haixing 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 Nantong Haixing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tibet Huayu and Nantong Haixing.
Diversification Opportunities for Tibet Huayu and Nantong Haixing
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tibet and Nantong is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Tibet Huayu Mining and Nantong Haixing Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nantong Haixing Elec 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 Nantong Haixing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nantong Haixing Elec has no effect on the direction of Tibet Huayu i.e., Tibet Huayu and Nantong Haixing go up and down completely randomly.
Pair Corralation between Tibet Huayu and Nantong Haixing
Assuming the 90 days trading horizon Tibet Huayu Mining is expected to generate 1.56 times more return on investment than Nantong Haixing. However, Tibet Huayu is 1.56 times more volatile than Nantong Haixing Electronics. It trades about 0.03 of its potential returns per unit of risk. Nantong Haixing Electronics is currently generating about -0.02 per unit of risk. If you would invest 972.00 in Tibet Huayu Mining on October 16, 2024 and sell it today you would earn a total of 259.00 from holding Tibet Huayu Mining or generate 26.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tibet Huayu Mining vs. Nantong Haixing Electronics
Performance |
| Timeline |
| Tibet Huayu Mining |
| Nantong Haixing Elec |
Tibet Huayu and Nantong Haixing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tibet Huayu and Nantong Haixing
The main advantage of trading using opposite Tibet Huayu and Nantong Haixing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tibet Huayu position performs unexpectedly, Nantong Haixing 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 Nantong Haixing will offset losses from the drop in Nantong Haixing's long position.| Tibet Huayu vs. Beijing Bewinner Communications | Tibet Huayu vs. Shenzhen MYS Environmental | Tibet Huayu vs. City Development Environment | Tibet Huayu vs. Tianjin Capital Environmental |
| Nantong Haixing vs. Sichuan Fulin Transportation | Nantong Haixing vs. GRIPM Advanced Materials | Nantong Haixing vs. Lander Sports Development | Nantong Haixing 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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