Correlation Between Hainan Haiqi and Fujian Longzhou
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By analyzing existing cross correlation between Hainan Haiqi Transportation and Fujian Longzhou Transportation, you can compare the effects of market volatilities on Hainan Haiqi and Fujian Longzhou 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 Hainan Haiqi with a short position of Fujian Longzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hainan Haiqi and Fujian Longzhou.
Diversification Opportunities for Hainan Haiqi and Fujian Longzhou
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hainan and Fujian is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Hainan Haiqi Transportation and Fujian Longzhou Transportation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Longzhou Tran and Hainan Haiqi 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 Hainan Haiqi Transportation are associated (or correlated) with Fujian Longzhou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Longzhou Tran has no effect on the direction of Hainan Haiqi i.e., Hainan Haiqi and Fujian Longzhou go up and down completely randomly.
Pair Corralation between Hainan Haiqi and Fujian Longzhou
Assuming the 90 days trading horizon Hainan Haiqi is expected to generate 2.68 times less return on investment than Fujian Longzhou. But when comparing it to its historical volatility, Hainan Haiqi Transportation is 1.33 times less risky than Fujian Longzhou. It trades about 0.17 of its potential returns per unit of risk. Fujian Longzhou Transportation is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 427.00 in Fujian Longzhou Transportation on September 5, 2024 and sell it today you would earn a total of 164.00 from holding Fujian Longzhou Transportation or generate 38.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hainan Haiqi Transportation vs. Fujian Longzhou Transportation
Performance |
| Timeline |
| Hainan Haiqi Transpo |
| Fujian Longzhou Tran |
Hainan Haiqi and Fujian Longzhou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hainan Haiqi and Fujian Longzhou
The main advantage of trading using opposite Hainan Haiqi and Fujian Longzhou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hainan Haiqi position performs unexpectedly, Fujian Longzhou 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 Fujian Longzhou will offset losses from the drop in Fujian Longzhou's long position.| Hainan Haiqi vs. Xiwang Foodstuffs Co | Hainan Haiqi vs. Ningbo Ligong Online | Hainan Haiqi vs. Pengxin International Mining | Hainan Haiqi vs. V V Food |
| Fujian Longzhou vs. Yunnan Jianzhijia Health Chain | Fujian Longzhou vs. Lotus Health Group | Fujian Longzhou vs. Everjoy Health Group | Fujian Longzhou vs. Shanghai Rongtai Health |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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