Correlation Between Shuhua Sports and Guangzhou Hongli
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By analyzing existing cross correlation between Shuhua Sports Co and Guangzhou Hongli Opto, you can compare the effects of market volatilities on Shuhua Sports and Guangzhou Hongli 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 Shuhua Sports with a short position of Guangzhou Hongli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shuhua Sports and Guangzhou Hongli.
Diversification Opportunities for Shuhua Sports and Guangzhou Hongli
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Shuhua and Guangzhou is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Shuhua Sports Co and Guangzhou Hongli Opto in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Hongli Opto and Shuhua Sports 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 Shuhua Sports Co are associated (or correlated) with Guangzhou Hongli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Hongli Opto has no effect on the direction of Shuhua Sports i.e., Shuhua Sports and Guangzhou Hongli go up and down completely randomly.
Pair Corralation between Shuhua Sports and Guangzhou Hongli
Assuming the 90 days trading horizon Shuhua Sports Co is expected to generate 1.3 times more return on investment than Guangzhou Hongli. However, Shuhua Sports is 1.3 times more volatile than Guangzhou Hongli Opto. It trades about -0.02 of its potential returns per unit of risk. Guangzhou Hongli Opto is currently generating about -0.18 per unit of risk. If you would invest 859.00 in Shuhua Sports Co on October 30, 2024 and sell it today you would lose (44.00) from holding Shuhua Sports Co or give up 5.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shuhua Sports Co vs. Guangzhou Hongli Opto
Performance |
| Timeline |
| Shuhua Sports |
| Guangzhou Hongli Opto |
Shuhua Sports and Guangzhou Hongli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shuhua Sports and Guangzhou Hongli
The main advantage of trading using opposite Shuhua Sports and Guangzhou Hongli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shuhua Sports position performs unexpectedly, Guangzhou Hongli 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 Guangzhou Hongli will offset losses from the drop in Guangzhou Hongli's long position.| Shuhua Sports vs. Cabio Biotech Wuhan | Shuhua Sports vs. Beijing YanDong MicroElectronic | Shuhua Sports vs. Techshine Electronics Co | Shuhua Sports vs. Nantong Haixing Electronics |
| Guangzhou Hongli vs. Hainan Haiqi Transportation | Guangzhou Hongli vs. Lontium Semiconductor Corp | Guangzhou Hongli vs. Hubei Tech Semiconductors | Guangzhou Hongli vs. Dazhong Transportation Group |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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