Correlation Between China State and HaiXin Foods
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By analyzing existing cross correlation between China State Construction and HaiXin Foods Co, you can compare the effects of market volatilities on China State and HaiXin Foods 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 China State with a short position of HaiXin Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of China State and HaiXin Foods.
Diversification Opportunities for China State and HaiXin Foods
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and HaiXin is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding China State Construction and HaiXin Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HaiXin Foods and China State 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 China State Construction are associated (or correlated) with HaiXin Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HaiXin Foods has no effect on the direction of China State i.e., China State and HaiXin Foods go up and down completely randomly.
Pair Corralation between China State and HaiXin Foods
Assuming the 90 days trading horizon China State Construction is expected to under-perform the HaiXin Foods. But the stock apears to be less risky and, when comparing its historical volatility, China State Construction is 1.88 times less risky than HaiXin Foods. The stock trades about -0.11 of its potential returns per unit of risk. The HaiXin Foods Co is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 370.00 in HaiXin Foods Co on August 26, 2024 and sell it today you would earn a total of 33.00 from holding HaiXin Foods Co or generate 8.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China State Construction vs. HaiXin Foods Co
Performance |
| Timeline |
| China State Construction |
| HaiXin Foods |
China State and HaiXin Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China State and HaiXin Foods
The main advantage of trading using opposite China State and HaiXin Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China State position performs unexpectedly, HaiXin Foods 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 HaiXin Foods will offset losses from the drop in HaiXin Foods' long position.| China State vs. Ming Yang Smart | China State vs. 159681 | China State vs. 159005 | China State vs. Loctek Ergonomic Technology |
| HaiXin Foods vs. China Petroleum Chemical | HaiXin Foods vs. PetroChina Co Ltd | HaiXin Foods vs. China State Construction | HaiXin Foods vs. China Railway 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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