Correlation Between Anhui Xinhua and New Hope
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By analyzing existing cross correlation between Anhui Xinhua Media and New Hope Dairy, you can compare the effects of market volatilities on Anhui Xinhua 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 Anhui Xinhua with a short position of New Hope. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Xinhua and New Hope.
Diversification Opportunities for Anhui Xinhua and New Hope
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Anhui and New is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Xinhua Media 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 Anhui Xinhua 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 Anhui Xinhua Media 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 Anhui Xinhua i.e., Anhui Xinhua and New Hope go up and down completely randomly.
Pair Corralation between Anhui Xinhua and New Hope
Assuming the 90 days trading horizon Anhui Xinhua Media is expected to under-perform the New Hope. But the stock apears to be less risky and, when comparing its historical volatility, Anhui Xinhua Media is 1.81 times less risky than New Hope. The stock trades about -0.23 of its potential returns per unit of risk. The New Hope Dairy is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,489 in New Hope Dairy on October 12, 2024 and sell it today you would earn a total of 56.00 from holding New Hope Dairy or generate 3.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Xinhua Media vs. New Hope Dairy
Performance |
| Timeline |
| Anhui Xinhua Media |
| New Hope Dairy |
Anhui Xinhua and New Hope Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Xinhua and New Hope
The main advantage of trading using opposite Anhui Xinhua and New Hope positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Xinhua 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.| Anhui Xinhua vs. Touchstone International Medical | Anhui Xinhua vs. Guangdong Transtek Medical | Anhui Xinhua vs. Chison Medical Technologies | Anhui Xinhua vs. Winner Medical Co |
| New Hope vs. Qingdao Foods Co | New Hope vs. Heilongjiang Publishing Media | New Hope vs. Guangdong Jinma Entertainment | New Hope vs. Anhui Xinhua Media |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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