Correlation Between Hengdian Entertainment and Chongqing Gas
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By analyzing existing cross correlation between Hengdian Entertainment Co and Chongqing Gas Grp, you can compare the effects of market volatilities on Hengdian Entertainment and Chongqing Gas 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 Chongqing Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hengdian Entertainment and Chongqing Gas.
Diversification Opportunities for Hengdian Entertainment and Chongqing Gas
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hengdian and Chongqing is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Hengdian Entertainment Co and Chongqing Gas Grp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Gas Grp 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 Chongqing Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Gas Grp has no effect on the direction of Hengdian Entertainment i.e., Hengdian Entertainment and Chongqing Gas go up and down completely randomly.
Pair Corralation between Hengdian Entertainment and Chongqing Gas
Assuming the 90 days trading horizon Hengdian Entertainment Co is expected to generate 3.68 times more return on investment than Chongqing Gas. However, Hengdian Entertainment is 3.68 times more volatile than Chongqing Gas Grp. It trades about 0.07 of its potential returns per unit of risk. Chongqing Gas Grp is currently generating about -0.07 per unit of risk. If you would invest 1,423 in Hengdian Entertainment Co on November 3, 2024 and sell it today you would earn a total of 52.00 from holding Hengdian Entertainment Co or generate 3.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hengdian Entertainment Co vs. Chongqing Gas Grp
Performance |
| Timeline |
| Hengdian Entertainment |
| Chongqing Gas Grp |
Hengdian Entertainment and Chongqing Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hengdian Entertainment and Chongqing Gas
The main advantage of trading using opposite Hengdian Entertainment and Chongqing Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hengdian Entertainment position performs unexpectedly, Chongqing Gas 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 Chongqing Gas will offset losses from the drop in Chongqing Gas' long position.| Hengdian Entertainment vs. China World Trade | Hengdian Entertainment vs. Shandong Longquan Pipeline | Hengdian Entertainment vs. Linewell Software Co | Hengdian Entertainment vs. Guangdong Jingyi Metal |
| Chongqing Gas vs. Shengda Mining Co | Chongqing Gas vs. Quectel Wireless Solutions | Chongqing Gas vs. JCHX Mining Management | Chongqing Gas vs. Nanxing Furniture Machinery |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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