Correlation Between Hefei Metalforming and Heilongjiang Transport
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By analyzing existing cross correlation between Hefei Metalforming Mach and Heilongjiang Transport Development, you can compare the effects of market volatilities on Hefei Metalforming and Heilongjiang Transport 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 Hefei Metalforming with a short position of Heilongjiang Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hefei Metalforming and Heilongjiang Transport.
Diversification Opportunities for Hefei Metalforming and Heilongjiang Transport
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hefei and Heilongjiang is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Hefei Metalforming Mach and Heilongjiang Transport Develop in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heilongjiang Transport and Hefei Metalforming 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 Hefei Metalforming Mach are associated (or correlated) with Heilongjiang Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heilongjiang Transport has no effect on the direction of Hefei Metalforming i.e., Hefei Metalforming and Heilongjiang Transport go up and down completely randomly.
Pair Corralation between Hefei Metalforming and Heilongjiang Transport
Assuming the 90 days trading horizon Hefei Metalforming Mach is expected to generate 1.17 times more return on investment than Heilongjiang Transport. However, Hefei Metalforming is 1.17 times more volatile than Heilongjiang Transport Development. It trades about 0.03 of its potential returns per unit of risk. Heilongjiang Transport Development is currently generating about 0.02 per unit of risk. If you would invest 738.00 in Hefei Metalforming Mach on September 14, 2024 and sell it today you would earn a total of 93.00 from holding Hefei Metalforming Mach or generate 12.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hefei Metalforming Mach vs. Heilongjiang Transport Develop
Performance |
| Timeline |
| Hefei Metalforming Mach |
| Heilongjiang Transport |
Hefei Metalforming and Heilongjiang Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hefei Metalforming and Heilongjiang Transport
The main advantage of trading using opposite Hefei Metalforming and Heilongjiang Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hefei Metalforming position performs unexpectedly, Heilongjiang Transport 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 Heilongjiang Transport will offset losses from the drop in Heilongjiang Transport's long position.| Hefei Metalforming vs. Industrial and Commercial | Hefei Metalforming vs. Kweichow Moutai Co | Hefei Metalforming vs. Agricultural Bank of | Hefei Metalforming vs. China Mobile Limited |
| Heilongjiang Transport vs. Industrial and Commercial | Heilongjiang Transport vs. Kweichow Moutai Co | Heilongjiang Transport vs. Agricultural Bank of | Heilongjiang Transport vs. China Mobile Limited |
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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