Correlation Between Tibet Huayu and Jiahe Foods
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By analyzing existing cross correlation between Tibet Huayu Mining and Jiahe Foods Industry, you can compare the effects of market volatilities on Tibet Huayu and Jiahe Foods 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 Jiahe Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tibet Huayu and Jiahe Foods.
Diversification Opportunities for Tibet Huayu and Jiahe Foods
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tibet and Jiahe is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Tibet Huayu Mining and Jiahe Foods Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiahe Foods Industry 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 Jiahe Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiahe Foods Industry has no effect on the direction of Tibet Huayu i.e., Tibet Huayu and Jiahe Foods go up and down completely randomly.
Pair Corralation between Tibet Huayu and Jiahe Foods
Assuming the 90 days trading horizon Tibet Huayu is expected to generate 4.16 times less return on investment than Jiahe Foods. But when comparing it to its historical volatility, Tibet Huayu Mining is 1.61 times less risky than Jiahe Foods. It trades about 0.09 of its potential returns per unit of risk. Jiahe Foods Industry is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 1,244 in Jiahe Foods Industry on September 13, 2024 and sell it today you would earn a total of 323.00 from holding Jiahe Foods Industry or generate 25.96% 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. Jiahe Foods Industry
Performance |
Timeline |
Tibet Huayu Mining |
Jiahe Foods Industry |
Tibet Huayu and Jiahe Foods Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tibet Huayu and Jiahe Foods
The main advantage of trading using opposite Tibet Huayu and Jiahe Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tibet Huayu position performs unexpectedly, Jiahe Foods 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 Jiahe Foods will offset losses from the drop in Jiahe Foods' 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 |
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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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