Correlation Between Hengdian Entertainment and Shanxi Lanhua
Specify exactly 2 symbols:
By analyzing existing cross correlation between Hengdian Entertainment Co and Shanxi Lanhua Sci Tech, you can compare the effects of market volatilities on Hengdian Entertainment and Shanxi Lanhua 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 Hengdian Entertainment with a short position of Shanxi Lanhua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hengdian Entertainment and Shanxi Lanhua.
Diversification Opportunities for Hengdian Entertainment and Shanxi Lanhua
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hengdian and Shanxi is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Hengdian Entertainment Co and Shanxi Lanhua Sci Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanxi Lanhua Sci and Hengdian Entertainment 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 Hengdian Entertainment Co are associated (or correlated) with Shanxi Lanhua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanxi Lanhua Sci has no effect on the direction of Hengdian Entertainment i.e., Hengdian Entertainment and Shanxi Lanhua go up and down completely randomly.
Pair Corralation between Hengdian Entertainment and Shanxi Lanhua
Assuming the 90 days trading horizon Hengdian Entertainment Co is expected to generate 1.37 times more return on investment than Shanxi Lanhua. However, Hengdian Entertainment is 1.37 times more volatile than Shanxi Lanhua Sci Tech. It trades about 0.17 of its potential returns per unit of risk. Shanxi Lanhua Sci Tech is currently generating about 0.02 per unit of risk. If you would invest 1,040 in Hengdian Entertainment Co on September 2, 2024 and sell it today you would earn a total of 447.00 from holding Hengdian Entertainment Co or generate 42.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hengdian Entertainment Co vs. Shanxi Lanhua Sci Tech
Performance |
| Timeline |
| Hengdian Entertainment |
| Shanxi Lanhua Sci |
Hengdian Entertainment and Shanxi Lanhua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hengdian Entertainment and Shanxi Lanhua
The main advantage of trading using opposite Hengdian Entertainment and Shanxi Lanhua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hengdian Entertainment position performs unexpectedly, Shanxi Lanhua 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 Shanxi Lanhua will offset losses from the drop in Shanxi Lanhua's long position.| Hengdian Entertainment vs. Lutian Machinery Co | Hengdian Entertainment vs. China Longyuan Power | Hengdian Entertainment vs. PetroChina Co Ltd | Hengdian Entertainment vs. Bank of China |
| Shanxi Lanhua vs. Bloomage Biotechnology Corp | Shanxi Lanhua vs. Xinjiang Communications Construction | Shanxi Lanhua vs. Guangdong Advertising Co | Shanxi Lanhua vs. Changchun BCHT Biotechnology |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |