Correlation Between Metallurgical and New Hope
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By analyzing existing cross correlation between Metallurgical of and New Hope Dairy, you can compare the effects of market volatilities on Metallurgical and New Hope 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 Metallurgical with a short position of New Hope. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metallurgical and New Hope.
Diversification Opportunities for Metallurgical and New Hope
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Metallurgical and New is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Metallurgical of and New Hope Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Hope Dairy and Metallurgical 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 Metallurgical of are associated (or correlated) with New Hope. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Hope Dairy has no effect on the direction of Metallurgical i.e., Metallurgical and New Hope go up and down completely randomly.
Pair Corralation between Metallurgical and New Hope
Assuming the 90 days trading horizon Metallurgical is expected to generate 1.61 times less return on investment than New Hope. But when comparing it to its historical volatility, Metallurgical of is 1.36 times less risky than New Hope. It trades about 0.02 of its potential returns per unit of risk. New Hope Dairy is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,300 in New Hope Dairy on September 13, 2024 and sell it today you would earn a total of 189.00 from holding New Hope Dairy or generate 14.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metallurgical of vs. New Hope Dairy
Performance |
| Timeline |
| Metallurgical |
| New Hope Dairy |
Metallurgical and New Hope Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metallurgical and New Hope
The main advantage of trading using opposite Metallurgical and New Hope positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metallurgical position performs unexpectedly, New Hope 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 New Hope will offset losses from the drop in New Hope's long position.| Metallurgical vs. Ming Yang Smart | Metallurgical vs. 159681 | Metallurgical vs. 159005 | Metallurgical vs. Loctek Ergonomic Technology |
| New Hope vs. Metallurgical of | New Hope vs. Hefei Metalforming Mach | New Hope vs. Jiangsu Xinri E Vehicle | New Hope vs. Dongfeng Automobile 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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