Correlation Between Sichuan Hebang and Hubei Geoway
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By analyzing existing cross correlation between Sichuan Hebang Biotechnology and Hubei Geoway Investment, you can compare the effects of market volatilities on Sichuan Hebang and Hubei Geoway 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 Sichuan Hebang with a short position of Hubei Geoway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Hebang and Hubei Geoway.
Diversification Opportunities for Sichuan Hebang and Hubei Geoway
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sichuan and Hubei is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Hebang Biotechnology and Hubei Geoway Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Geoway Investment and Sichuan Hebang 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 Sichuan Hebang Biotechnology are associated (or correlated) with Hubei Geoway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Geoway Investment has no effect on the direction of Sichuan Hebang i.e., Sichuan Hebang and Hubei Geoway go up and down completely randomly.
Pair Corralation between Sichuan Hebang and Hubei Geoway
Assuming the 90 days trading horizon Sichuan Hebang Biotechnology is expected to under-perform the Hubei Geoway. But the stock apears to be less risky and, when comparing its historical volatility, Sichuan Hebang Biotechnology is 1.84 times less risky than Hubei Geoway. The stock trades about -0.04 of its potential returns per unit of risk. The Hubei Geoway Investment is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 139.00 in Hubei Geoway Investment on September 1, 2024 and sell it today you would earn a total of 9.00 from holding Hubei Geoway Investment or generate 6.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Hebang Biotechnology vs. Hubei Geoway Investment
Performance |
| Timeline |
| Sichuan Hebang Biote |
| Hubei Geoway Investment |
Sichuan Hebang and Hubei Geoway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Hebang and Hubei Geoway
The main advantage of trading using opposite Sichuan Hebang and Hubei Geoway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Hebang position performs unexpectedly, Hubei Geoway 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 Hubei Geoway will offset losses from the drop in Hubei Geoway's long position.| Sichuan Hebang vs. Zijin Mining Group | Sichuan Hebang vs. Wanhua Chemical Group | Sichuan Hebang vs. Baoshan Iron Steel | Sichuan Hebang vs. Shandong Gold Mining |
| Hubei Geoway vs. Qingdao Choho Industrial | Hubei Geoway vs. Jiangsu Jinling Sports | Hubei Geoway vs. Western Metal Materials | Hubei Geoway vs. China Sports Industry |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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