Correlation Between Heilongjiang Transport and Dazhong Transportation
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By analyzing existing cross correlation between Heilongjiang Transport Development and Dazhong Transportation Group, you can compare the effects of market volatilities on Heilongjiang Transport and Dazhong 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 Dazhong Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Transport and Dazhong Transportation.
Diversification Opportunities for Heilongjiang Transport and Dazhong Transportation
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Heilongjiang and Dazhong is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Transport Develop and Dazhong Transportation Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dazhong 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 Dazhong Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dazhong Transportation has no effect on the direction of Heilongjiang Transport i.e., Heilongjiang Transport and Dazhong Transportation go up and down completely randomly.
Pair Corralation between Heilongjiang Transport and Dazhong Transportation
Assuming the 90 days trading horizon Heilongjiang Transport Development is expected to generate 0.72 times more return on investment than Dazhong Transportation. However, Heilongjiang Transport Development is 1.39 times less risky than Dazhong Transportation. It trades about 0.16 of its potential returns per unit of risk. Dazhong Transportation Group is currently generating about 0.01 per unit of risk. If you would invest 357.00 in Heilongjiang Transport Development on August 29, 2024 and sell it today you would earn a total of 25.00 from holding Heilongjiang Transport Development or generate 7.0% 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. Dazhong Transportation Group
Performance |
| Timeline |
| Heilongjiang Transport |
| Dazhong Transportation |
Heilongjiang Transport and Dazhong Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Transport and Dazhong Transportation
The main advantage of trading using opposite Heilongjiang Transport and Dazhong Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Transport position performs unexpectedly, Dazhong 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 Dazhong Transportation will offset losses from the drop in Dazhong Transportation's long position.| Heilongjiang Transport vs. PetroChina Co Ltd | Heilongjiang Transport vs. China State Construction | Heilongjiang Transport vs. China Mobile Limited | Heilongjiang Transport vs. Industrial and Commercial |
| Dazhong Transportation vs. PetroChina Co Ltd | Dazhong Transportation vs. China State Construction | Dazhong Transportation vs. China Mobile Limited | Dazhong Transportation vs. Industrial and Commercial |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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