Correlation Between Zhejiang Huayou and HUAQIN TECHNOLOGY
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By analyzing existing cross correlation between Zhejiang Huayou Cobalt and HUAQIN TECHNOLOGY LTD, you can compare the effects of market volatilities on Zhejiang Huayou and HUAQIN TECHNOLOGY 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 Zhejiang Huayou with a short position of HUAQIN TECHNOLOGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Huayou and HUAQIN TECHNOLOGY.
Diversification Opportunities for Zhejiang Huayou and HUAQIN TECHNOLOGY
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Zhejiang and HUAQIN is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Huayou Cobalt and HUAQIN TECHNOLOGY LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUAQIN TECHNOLOGY LTD and Zhejiang Huayou 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 Zhejiang Huayou Cobalt are associated (or correlated) with HUAQIN TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HUAQIN TECHNOLOGY LTD has no effect on the direction of Zhejiang Huayou i.e., Zhejiang Huayou and HUAQIN TECHNOLOGY go up and down completely randomly.
Pair Corralation between Zhejiang Huayou and HUAQIN TECHNOLOGY
Assuming the 90 days trading horizon Zhejiang Huayou Cobalt is expected to under-perform the HUAQIN TECHNOLOGY. But the stock apears to be less risky and, when comparing its historical volatility, Zhejiang Huayou Cobalt is 2.48 times less risky than HUAQIN TECHNOLOGY. The stock trades about -0.09 of its potential returns per unit of risk. The HUAQIN TECHNOLOGY LTD is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 6,051 in HUAQIN TECHNOLOGY LTD on October 18, 2024 and sell it today you would earn a total of 873.00 from holding HUAQIN TECHNOLOGY LTD or generate 14.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Huayou Cobalt vs. HUAQIN TECHNOLOGY LTD
Performance |
| Timeline |
| Zhejiang Huayou Cobalt |
| HUAQIN TECHNOLOGY LTD |
Zhejiang Huayou and HUAQIN TECHNOLOGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Huayou and HUAQIN TECHNOLOGY
The main advantage of trading using opposite Zhejiang Huayou and HUAQIN TECHNOLOGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Huayou position performs unexpectedly, HUAQIN TECHNOLOGY 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 HUAQIN TECHNOLOGY will offset losses from the drop in HUAQIN TECHNOLOGY's long position.| Zhejiang Huayou vs. HUAQIN TECHNOLOGY LTD | Zhejiang Huayou vs. Ningbo Fangzheng Automobile | Zhejiang Huayou vs. China Mobile Limited | Zhejiang Huayou vs. Tongyu Communication |
| HUAQIN TECHNOLOGY vs. Sharetronic Data Technology | HUAQIN TECHNOLOGY vs. Sichuan Furong Technology | HUAQIN TECHNOLOGY vs. Emdoor Information Co | HUAQIN TECHNOLOGY vs. Guodian Nanjing Automation |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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