Correlation Between Heilongjiang Transport and Bank of XiAn
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By analyzing existing cross correlation between Heilongjiang Transport Development and Bank of XiAn, you can compare the effects of market volatilities on Heilongjiang Transport and Bank of XiAn 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 Bank of XiAn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Transport and Bank of XiAn.
Diversification Opportunities for Heilongjiang Transport and Bank of XiAn
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Heilongjiang and Bank is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Transport Develop and Bank of XiAn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of XiAn 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 Bank of XiAn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of XiAn has no effect on the direction of Heilongjiang Transport i.e., Heilongjiang Transport and Bank of XiAn go up and down completely randomly.
Pair Corralation between Heilongjiang Transport and Bank of XiAn
Assuming the 90 days trading horizon Heilongjiang Transport Development is expected to generate 1.64 times more return on investment than Bank of XiAn. However, Heilongjiang Transport is 1.64 times more volatile than Bank of XiAn. It trades about 0.09 of its potential returns per unit of risk. Bank of XiAn is currently generating about 0.07 per unit of risk. If you would invest 309.00 in Heilongjiang Transport Development on September 13, 2024 and sell it today you would earn a total of 96.00 from holding Heilongjiang Transport Development or generate 31.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.18% |
| Values | Daily Returns |
Heilongjiang Transport Develop vs. Bank of XiAn
Performance |
| Timeline |
| Heilongjiang Transport |
| Bank of XiAn |
Heilongjiang Transport and Bank of XiAn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Transport and Bank of XiAn
The main advantage of trading using opposite Heilongjiang Transport and Bank of XiAn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Transport position performs unexpectedly, Bank of XiAn 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 Bank of XiAn will offset losses from the drop in Bank of XiAn's long position.The idea behind Heilongjiang Transport Development and Bank of XiAn pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Bank of XiAn vs. Heilongjiang Transport Development | Bank of XiAn vs. Sino Platinum Metals Co | Bank of XiAn vs. Northking Information Technology | Bank of XiAn vs. Kuangda Technology Group |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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