Correlation Between Chahua Modern and North Huajin
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By analyzing existing cross correlation between Chahua Modern Housewares and North Huajin Chemical, you can compare the effects of market volatilities on Chahua Modern and North Huajin 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 Chahua Modern with a short position of North Huajin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chahua Modern and North Huajin.
Diversification Opportunities for Chahua Modern and North Huajin
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chahua and North is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Chahua Modern Housewares and North Huajin Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North Huajin Chemical and Chahua Modern 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 Chahua Modern Housewares are associated (or correlated) with North Huajin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North Huajin Chemical has no effect on the direction of Chahua Modern i.e., Chahua Modern and North Huajin go up and down completely randomly.
Pair Corralation between Chahua Modern and North Huajin
Assuming the 90 days trading horizon Chahua Modern Housewares is expected to generate 1.34 times more return on investment than North Huajin. However, Chahua Modern is 1.34 times more volatile than North Huajin Chemical. It trades about 0.07 of its potential returns per unit of risk. North Huajin Chemical is currently generating about -0.02 per unit of risk. If you would invest 802.00 in Chahua Modern Housewares on October 9, 2024 and sell it today you would earn a total of 1,230 from holding Chahua Modern Housewares or generate 153.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chahua Modern Housewares vs. North Huajin Chemical
Performance |
| Timeline |
| Chahua Modern Housewares |
| North Huajin Chemical |
Chahua Modern and North Huajin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chahua Modern and North Huajin
The main advantage of trading using opposite Chahua Modern and North Huajin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chahua Modern position performs unexpectedly, North Huajin 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 North Huajin will offset losses from the drop in North Huajin's long position.| Chahua Modern vs. Ningbo Kangqiang Electronics | Chahua Modern vs. LianChuang Electronic Technology | Chahua Modern vs. Zhejiang Yongjin Metal | Chahua Modern vs. Nantong Haixing Electronics |
| North Huajin vs. Zijin Mining Group | North Huajin vs. Wanhua Chemical Group | North Huajin vs. Baoshan Iron Steel | North Huajin vs. Shandong Gold Mining |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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