Correlation Between HUAQIN TECHNOLOGY and Shandong Sanyuan
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By analyzing existing cross correlation between HUAQIN TECHNOLOGY LTD and Shandong Sanyuan Biotechnology, you can compare the effects of market volatilities on HUAQIN TECHNOLOGY and Shandong Sanyuan 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 Shandong Sanyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUAQIN TECHNOLOGY and Shandong Sanyuan.
Diversification Opportunities for HUAQIN TECHNOLOGY and Shandong Sanyuan
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HUAQIN and Shandong is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding HUAQIN TECHNOLOGY LTD and Shandong Sanyuan Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Sanyuan Bio 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 Shandong Sanyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Sanyuan Bio has no effect on the direction of HUAQIN TECHNOLOGY i.e., HUAQIN TECHNOLOGY and Shandong Sanyuan go up and down completely randomly.
Pair Corralation between HUAQIN TECHNOLOGY and Shandong Sanyuan
Assuming the 90 days trading horizon HUAQIN TECHNOLOGY LTD is expected to generate 1.23 times more return on investment than Shandong Sanyuan. However, HUAQIN TECHNOLOGY is 1.23 times more volatile than Shandong Sanyuan Biotechnology. It trades about 0.27 of its potential returns per unit of risk. Shandong Sanyuan Biotechnology is currently generating about 0.05 per unit of risk. If you would invest 5,943 in HUAQIN TECHNOLOGY LTD on September 27, 2024 and sell it today you would earn a total of 958.00 from holding HUAQIN TECHNOLOGY LTD or generate 16.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HUAQIN TECHNOLOGY LTD vs. Shandong Sanyuan Biotechnology
Performance |
| Timeline |
| HUAQIN TECHNOLOGY LTD |
| Shandong Sanyuan Bio |
HUAQIN TECHNOLOGY and Shandong Sanyuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUAQIN TECHNOLOGY and Shandong Sanyuan
The main advantage of trading using opposite HUAQIN TECHNOLOGY and Shandong Sanyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUAQIN TECHNOLOGY position performs unexpectedly, Shandong Sanyuan 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 Shandong Sanyuan will offset losses from the drop in Shandong Sanyuan's long position.| HUAQIN TECHNOLOGY vs. Anker Innovations Technology | HUAQIN TECHNOLOGY vs. Sharetronic Data Technology | HUAQIN TECHNOLOGY vs. Hangzhou EZVIZ Network | HUAQIN TECHNOLOGY vs. Sichuan Furong Technology |
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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