Correlation Between HUAQIN TECHNOLOGY and Hangzhou Guotai
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By analyzing existing cross correlation between HUAQIN TECHNOLOGY LTD and Hangzhou Guotai Environmental, you can compare the effects of market volatilities on HUAQIN TECHNOLOGY and Hangzhou Guotai 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 HUAQIN TECHNOLOGY with a short position of Hangzhou Guotai. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUAQIN TECHNOLOGY and Hangzhou Guotai.
Diversification Opportunities for HUAQIN TECHNOLOGY and Hangzhou Guotai
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between HUAQIN and Hangzhou is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding HUAQIN TECHNOLOGY LTD and Hangzhou Guotai Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hangzhou Guotai Envi and HUAQIN TECHNOLOGY 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 HUAQIN TECHNOLOGY LTD are associated (or correlated) with Hangzhou Guotai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hangzhou Guotai Envi has no effect on the direction of HUAQIN TECHNOLOGY i.e., HUAQIN TECHNOLOGY and Hangzhou Guotai go up and down completely randomly.
Pair Corralation between HUAQIN TECHNOLOGY and Hangzhou Guotai
Assuming the 90 days trading horizon HUAQIN TECHNOLOGY LTD is expected to generate 1.89 times more return on investment than Hangzhou Guotai. However, HUAQIN TECHNOLOGY is 1.89 times more volatile than Hangzhou Guotai Environmental. It trades about 0.17 of its potential returns per unit of risk. Hangzhou Guotai Environmental is currently generating about -0.04 per unit of risk. If you would invest 6,189 in HUAQIN TECHNOLOGY LTD on October 12, 2024 and sell it today you would earn a total of 849.00 from holding HUAQIN TECHNOLOGY LTD or generate 13.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HUAQIN TECHNOLOGY LTD vs. Hangzhou Guotai Environmental
Performance |
| Timeline |
| HUAQIN TECHNOLOGY LTD |
| Hangzhou Guotai Envi |
HUAQIN TECHNOLOGY and Hangzhou Guotai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUAQIN TECHNOLOGY and Hangzhou Guotai
The main advantage of trading using opposite HUAQIN TECHNOLOGY and Hangzhou Guotai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUAQIN TECHNOLOGY position performs unexpectedly, Hangzhou Guotai 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 Hangzhou Guotai will offset losses from the drop in Hangzhou Guotai's long position.| HUAQIN TECHNOLOGY vs. Sharetronic Data Technology | HUAQIN TECHNOLOGY vs. Sichuan Furong Technology | HUAQIN TECHNOLOGY vs. Emdoor Information Co | HUAQIN TECHNOLOGY vs. Guodian Nanjing Automation |
| Hangzhou Guotai vs. HUAQIN TECHNOLOGY LTD | Hangzhou Guotai vs. Soyea Technology Co | Hangzhou Guotai vs. Kuangda Technology Group | Hangzhou Guotai vs. Kingsignal Technology 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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