Correlation Between Xiamen Goldenhome and Holitech Technology
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By analyzing existing cross correlation between Xiamen Goldenhome Co and Holitech Technology Co, you can compare the effects of market volatilities on Xiamen Goldenhome and Holitech Technology 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 Xiamen Goldenhome with a short position of Holitech Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen Goldenhome and Holitech Technology.
Diversification Opportunities for Xiamen Goldenhome and Holitech Technology
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xiamen and Holitech is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen Goldenhome Co and Holitech Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holitech Technology and Xiamen Goldenhome 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 Xiamen Goldenhome Co are associated (or correlated) with Holitech Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holitech Technology has no effect on the direction of Xiamen Goldenhome i.e., Xiamen Goldenhome and Holitech Technology go up and down completely randomly.
Pair Corralation between Xiamen Goldenhome and Holitech Technology
Assuming the 90 days trading horizon Xiamen Goldenhome Co is expected to under-perform the Holitech Technology. But the stock apears to be less risky and, when comparing its historical volatility, Xiamen Goldenhome Co is 1.56 times less risky than Holitech Technology. The stock trades about -0.03 of its potential returns per unit of risk. The Holitech Technology Co is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 325.00 in Holitech Technology Co on September 12, 2024 and sell it today you would lose (97.00) from holding Holitech Technology Co or give up 29.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen Goldenhome Co vs. Holitech Technology Co
Performance |
| Timeline |
| Xiamen Goldenhome |
| Holitech Technology |
Xiamen Goldenhome and Holitech Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen Goldenhome and Holitech Technology
The main advantage of trading using opposite Xiamen Goldenhome and Holitech Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen Goldenhome position performs unexpectedly, Holitech Technology 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 Holitech Technology will offset losses from the drop in Holitech Technology's long position.| Xiamen Goldenhome vs. Lutian Machinery Co | Xiamen Goldenhome vs. PetroChina Co Ltd | Xiamen Goldenhome vs. Bank of China | Xiamen Goldenhome vs. Gansu Jiu Steel |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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