Correlation Between Heilongjiang Transport and Xinjiang Zhongtai
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By analyzing existing cross correlation between Heilongjiang Transport Development and Xinjiang Zhongtai Chemical, you can compare the effects of market volatilities on Heilongjiang Transport and Xinjiang Zhongtai 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 Heilongjiang Transport with a short position of Xinjiang Zhongtai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Transport and Xinjiang Zhongtai.
Diversification Opportunities for Heilongjiang Transport and Xinjiang Zhongtai
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Heilongjiang and Xinjiang is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Transport Develop and Xinjiang Zhongtai Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Zhongtai and Heilongjiang Transport 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 Heilongjiang Transport Development are associated (or correlated) with Xinjiang Zhongtai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Zhongtai has no effect on the direction of Heilongjiang Transport i.e., Heilongjiang Transport and Xinjiang Zhongtai go up and down completely randomly.
Pair Corralation between Heilongjiang Transport and Xinjiang Zhongtai
Assuming the 90 days trading horizon Heilongjiang Transport Development is expected to generate 1.21 times more return on investment than Xinjiang Zhongtai. However, Heilongjiang Transport is 1.21 times more volatile than Xinjiang Zhongtai Chemical. It trades about 0.25 of its potential returns per unit of risk. Xinjiang Zhongtai Chemical is currently generating about 0.18 per unit of risk. If you would invest 372.00 in Heilongjiang Transport Development on September 14, 2024 and sell it today you would earn a total of 52.00 from holding Heilongjiang Transport Development or generate 13.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heilongjiang Transport Develop vs. Xinjiang Zhongtai Chemical
Performance |
| Timeline |
| Heilongjiang Transport |
| Xinjiang Zhongtai |
Heilongjiang Transport and Xinjiang Zhongtai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Transport and Xinjiang Zhongtai
The main advantage of trading using opposite Heilongjiang Transport and Xinjiang Zhongtai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Transport position performs unexpectedly, Xinjiang Zhongtai 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 Xinjiang Zhongtai will offset losses from the drop in Xinjiang Zhongtai's long position.| Heilongjiang Transport vs. Industrial and Commercial | Heilongjiang Transport vs. Kweichow Moutai Co | Heilongjiang Transport vs. Agricultural Bank of | Heilongjiang Transport vs. China Mobile Limited |
| Xinjiang Zhongtai vs. Linewell Software Co | Xinjiang Zhongtai vs. Hainan Mining Co | Xinjiang Zhongtai vs. Chenzhou Jingui Silver | Xinjiang Zhongtai vs. Fujian Rongji Software |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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