Correlation Between Hainan Haiqi and Zhengping RoadBridge
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By analyzing existing cross correlation between Hainan Haiqi Transportation and Zhengping RoadBridge Constr, you can compare the effects of market volatilities on Hainan Haiqi and Zhengping RoadBridge 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 Zhengping RoadBridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hainan Haiqi and Zhengping RoadBridge.
Diversification Opportunities for Hainan Haiqi and Zhengping RoadBridge
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hainan and Zhengping is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Hainan Haiqi Transportation and Zhengping RoadBridge Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhengping RoadBridge 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 Zhengping RoadBridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhengping RoadBridge has no effect on the direction of Hainan Haiqi i.e., Hainan Haiqi and Zhengping RoadBridge go up and down completely randomly.
Pair Corralation between Hainan Haiqi and Zhengping RoadBridge
Assuming the 90 days trading horizon Hainan Haiqi Transportation is expected to under-perform the Zhengping RoadBridge. But the stock apears to be less risky and, when comparing its historical volatility, Hainan Haiqi Transportation is 1.27 times less risky than Zhengping RoadBridge. The stock trades about -0.01 of its potential returns per unit of risk. The Zhengping RoadBridge Constr is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 306.00 in Zhengping RoadBridge Constr on August 28, 2024 and sell it today you would earn a total of 45.00 from holding Zhengping RoadBridge Constr or generate 14.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hainan Haiqi Transportation vs. Zhengping RoadBridge Constr
Performance |
| Timeline |
| Hainan Haiqi Transpo |
| Zhengping RoadBridge |
Hainan Haiqi and Zhengping RoadBridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hainan Haiqi and Zhengping RoadBridge
The main advantage of trading using opposite Hainan Haiqi and Zhengping RoadBridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hainan Haiqi position performs unexpectedly, Zhengping RoadBridge 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 Zhengping RoadBridge will offset losses from the drop in Zhengping RoadBridge's long position.| Hainan Haiqi vs. Cambricon Technologies Corp | Hainan Haiqi vs. Loongson Technology Corp | Hainan Haiqi vs. Chongqing Road Bridge | Hainan Haiqi vs. Shenzhen Fortune Trend |
| Zhengping RoadBridge vs. HanS Laser Tech | Zhengping RoadBridge vs. Hainan Airlines Co | Zhengping RoadBridge vs. Shanghai Jinfeng Wine | Zhengping RoadBridge vs. Juneyao Airlines |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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