Correlation Between Hoshine Silicon and Wanhua Chemical
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By analyzing existing cross correlation between Hoshine Silicon Ind and Wanhua Chemical Group, you can compare the effects of market volatilities on Hoshine Silicon and Wanhua 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 Wanhua Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hoshine Silicon and Wanhua Chemical.
Diversification Opportunities for Hoshine Silicon and Wanhua Chemical
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hoshine and Wanhua is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Hoshine Silicon Ind and Wanhua Chemical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wanhua Chemical Group 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 Wanhua Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wanhua Chemical Group has no effect on the direction of Hoshine Silicon i.e., Hoshine Silicon and Wanhua Chemical go up and down completely randomly.
Pair Corralation between Hoshine Silicon and Wanhua Chemical
Assuming the 90 days trading horizon Hoshine Silicon Ind is expected to generate 1.75 times more return on investment than Wanhua Chemical. However, Hoshine Silicon is 1.75 times more volatile than Wanhua Chemical Group. It trades about 0.04 of its potential returns per unit of risk. Wanhua Chemical Group is currently generating about -0.08 per unit of risk. If you would invest 5,896 in Hoshine Silicon Ind on August 24, 2024 and sell it today you would earn a total of 104.00 from holding Hoshine Silicon Ind or generate 1.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hoshine Silicon Ind vs. Wanhua Chemical Group
Performance |
| Timeline |
| Hoshine Silicon Ind |
| Wanhua Chemical Group |
Hoshine Silicon and Wanhua Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hoshine Silicon and Wanhua Chemical
The main advantage of trading using opposite Hoshine Silicon and Wanhua Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hoshine Silicon position performs unexpectedly, Wanhua 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 Wanhua Chemical will offset losses from the drop in Wanhua 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. Shandong Gold Mining |
| Wanhua Chemical vs. VeriSilicon Microelectronics Shanghai | Wanhua Chemical vs. Hoshine Silicon Ind | Wanhua Chemical vs. Shandong Ruifeng Chemical | Wanhua Chemical vs. Lianhe Chemical Technology |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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