Correlation Between Nantong Haixing and Anhui Huaertai
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By analyzing existing cross correlation between Nantong Haixing Electronics and Anhui Huaertai Chemical, you can compare the effects of market volatilities on Nantong Haixing and Anhui Huaertai 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 Nantong Haixing with a short position of Anhui Huaertai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nantong Haixing and Anhui Huaertai.
Diversification Opportunities for Nantong Haixing and Anhui Huaertai
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nantong and Anhui is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Nantong Haixing Electronics and Anhui Huaertai Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Huaertai Chemical and Nantong Haixing 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 Nantong Haixing Electronics are associated (or correlated) with Anhui Huaertai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Huaertai Chemical has no effect on the direction of Nantong Haixing i.e., Nantong Haixing and Anhui Huaertai go up and down completely randomly.
Pair Corralation between Nantong Haixing and Anhui Huaertai
Assuming the 90 days trading horizon Nantong Haixing is expected to generate 8.23 times less return on investment than Anhui Huaertai. But when comparing it to its historical volatility, Nantong Haixing Electronics is 1.89 times less risky than Anhui Huaertai. It trades about 0.08 of its potential returns per unit of risk. Anhui Huaertai Chemical is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 1,072 in Anhui Huaertai Chemical on September 13, 2024 and sell it today you would earn a total of 303.00 from holding Anhui Huaertai Chemical or generate 28.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nantong Haixing Electronics vs. Anhui Huaertai Chemical
Performance |
| Timeline |
| Nantong Haixing Elec |
| Anhui Huaertai Chemical |
Nantong Haixing and Anhui Huaertai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nantong Haixing and Anhui Huaertai
The main advantage of trading using opposite Nantong Haixing and Anhui Huaertai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nantong Haixing position performs unexpectedly, Anhui Huaertai 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 Anhui Huaertai will offset losses from the drop in Anhui Huaertai's long position.| Nantong Haixing vs. Industrial and Commercial | Nantong Haixing vs. Agricultural Bank of | Nantong Haixing vs. China Construction Bank | Nantong Haixing vs. Bank of China |
| Anhui Huaertai vs. Dhc Software Co | Anhui Huaertai vs. HUAQIN TECHNOLOGY LTD | Anhui Huaertai vs. Nanxing Furniture Machinery | Anhui Huaertai vs. Western Superconducting Tech |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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