Correlation Between Hoshine Silicon and Lier Chemical
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By analyzing existing cross correlation between Hoshine Silicon Ind and Lier Chemical Co, you can compare the effects of market volatilities on Hoshine Silicon and Lier Chemical 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 Hoshine Silicon with a short position of Lier Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hoshine Silicon and Lier Chemical.
Diversification Opportunities for Hoshine Silicon and Lier Chemical
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hoshine and Lier is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Hoshine Silicon Ind and Lier Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lier Chemical and Hoshine Silicon 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 Hoshine Silicon Ind are associated (or correlated) with Lier Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lier Chemical has no effect on the direction of Hoshine Silicon i.e., Hoshine Silicon and Lier Chemical go up and down completely randomly.
Pair Corralation between Hoshine Silicon and Lier Chemical
Assuming the 90 days trading horizon Hoshine Silicon Ind is expected to generate 1.17 times more return on investment than Lier Chemical. However, Hoshine Silicon is 1.17 times more volatile than Lier Chemical Co. It trades about -0.01 of its potential returns per unit of risk. Lier Chemical Co is currently generating about -0.06 per unit of risk. If you would invest 7,153 in Hoshine Silicon Ind on September 12, 2024 and sell it today you would lose (1,184) from holding Hoshine Silicon Ind or give up 16.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hoshine Silicon Ind vs. Lier Chemical Co
Performance |
| Timeline |
| Hoshine Silicon Ind |
| Lier Chemical |
Hoshine Silicon and Lier Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hoshine Silicon and Lier Chemical
The main advantage of trading using opposite Hoshine Silicon and Lier Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hoshine Silicon position performs unexpectedly, Lier Chemical 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 Lier Chemical will offset losses from the drop in Lier Chemical's long position.| Hoshine Silicon vs. Zijin Mining Group | Hoshine Silicon vs. Wanhua Chemical Group | Hoshine Silicon vs. Baoshan Iron Steel | Hoshine Silicon vs. Rongsheng Petrochemical Co |
| Lier Chemical vs. Zijin Mining Group | Lier Chemical vs. Wanhua Chemical Group | Lier Chemical vs. Baoshan Iron Steel | Lier Chemical vs. Rongsheng Petrochemical Co |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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