Correlation Between Shanghai Yanpu and Holitech Technology
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By analyzing existing cross correlation between Shanghai Yanpu Metal and Holitech Technology Co, you can compare the effects of market volatilities on Shanghai Yanpu and Holitech 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 Shanghai Yanpu with a short position of Holitech Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Yanpu and Holitech Technology.
Diversification Opportunities for Shanghai Yanpu and Holitech Technology
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Holitech is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Yanpu Metal and Holitech Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holitech Technology and Shanghai Yanpu 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 Shanghai Yanpu Metal are associated (or correlated) with Holitech Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holitech Technology has no effect on the direction of Shanghai Yanpu i.e., Shanghai Yanpu and Holitech Technology go up and down completely randomly.
Pair Corralation between Shanghai Yanpu and Holitech Technology
Assuming the 90 days trading horizon Shanghai Yanpu is expected to generate 5.93 times less return on investment than Holitech Technology. But when comparing it to its historical volatility, Shanghai Yanpu Metal is 1.3 times less risky than Holitech Technology. It trades about 0.09 of its potential returns per unit of risk. Holitech Technology Co is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 166.00 in Holitech Technology Co on August 30, 2024 and sell it today you would earn a total of 66.00 from holding Holitech Technology Co or generate 39.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Yanpu Metal vs. Holitech Technology Co
Performance |
| Timeline |
| Shanghai Yanpu Metal |
| Holitech Technology |
Shanghai Yanpu and Holitech Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Yanpu and Holitech Technology
The main advantage of trading using opposite Shanghai Yanpu and Holitech Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Yanpu position performs unexpectedly, Holitech 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 Holitech Technology will offset losses from the drop in Holitech Technology's long position.| Shanghai Yanpu vs. Chengtun Mining Group | Shanghai Yanpu vs. Great Sun Foods Co | Shanghai Yanpu vs. Hengli Industrial Development | Shanghai Yanpu vs. New Hope Dairy |
| Holitech Technology vs. China State Construction | Holitech Technology vs. Huafa Industrial Co | Holitech Technology vs. China International Capital | Holitech Technology vs. Kweichow Moutai 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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