Correlation Between Heilongjiang Transport and Hubeiyichang Transportation
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By analyzing existing cross correlation between Heilongjiang Transport Development and Hubeiyichang Transportation Group, you can compare the effects of market volatilities on Heilongjiang Transport and Hubeiyichang Transportation 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 Hubeiyichang Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Transport and Hubeiyichang Transportation.
Diversification Opportunities for Heilongjiang Transport and Hubeiyichang Transportation
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Heilongjiang and Hubeiyichang is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Transport Develop and Hubeiyichang Transportation Gr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubeiyichang Transportation 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 Hubeiyichang Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubeiyichang Transportation has no effect on the direction of Heilongjiang Transport i.e., Heilongjiang Transport and Hubeiyichang Transportation go up and down completely randomly.
Pair Corralation between Heilongjiang Transport and Hubeiyichang Transportation
Assuming the 90 days trading horizon Heilongjiang Transport Development is expected to under-perform the Hubeiyichang Transportation. In addition to that, Heilongjiang Transport is 1.3 times more volatile than Hubeiyichang Transportation Group. It trades about -0.09 of its total potential returns per unit of risk. Hubeiyichang Transportation Group is currently generating about -0.05 per unit of volatility. If you would invest 524.00 in Hubeiyichang Transportation Group on October 26, 2024 and sell it today you would lose (23.00) from holding Hubeiyichang Transportation Group or give up 4.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heilongjiang Transport Develop vs. Hubeiyichang Transportation Gr
Performance |
| Timeline |
| Heilongjiang Transport |
| Hubeiyichang Transportation |
Heilongjiang Transport and Hubeiyichang Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Transport and Hubeiyichang Transportation
The main advantage of trading using opposite Heilongjiang Transport and Hubeiyichang Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Transport position performs unexpectedly, Hubeiyichang Transportation 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 Hubeiyichang Transportation will offset losses from the drop in Hubeiyichang Transportation's long position.| Heilongjiang Transport vs. PetroChina Co Ltd | Heilongjiang Transport vs. China Mobile Limited | Heilongjiang Transport vs. CNOOC Limited | Heilongjiang Transport vs. Ping An Insurance |
| Hubeiyichang Transportation vs. China Life Insurance | Hubeiyichang Transportation vs. Cinda Securities Co | Hubeiyichang Transportation vs. Piotech Inc A | Hubeiyichang Transportation vs. Dongxing Sec Co |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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