Correlation Between Hangzhou Huawang and Zhejiang Construction
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By analyzing existing cross correlation between Hangzhou Huawang New and Zhejiang Construction Investment, you can compare the effects of market volatilities on Hangzhou Huawang and Zhejiang Construction 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 Hangzhou Huawang with a short position of Zhejiang Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hangzhou Huawang and Zhejiang Construction.
Diversification Opportunities for Hangzhou Huawang and Zhejiang Construction
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hangzhou and Zhejiang is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Hangzhou Huawang New and Zhejiang Construction Investme in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Construction and Hangzhou Huawang 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 Hangzhou Huawang New are associated (or correlated) with Zhejiang Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Construction has no effect on the direction of Hangzhou Huawang i.e., Hangzhou Huawang and Zhejiang Construction go up and down completely randomly.
Pair Corralation between Hangzhou Huawang and Zhejiang Construction
Assuming the 90 days trading horizon Hangzhou Huawang New is expected to under-perform the Zhejiang Construction. But the stock apears to be less risky and, when comparing its historical volatility, Hangzhou Huawang New is 1.4 times less risky than Zhejiang Construction. The stock trades about -0.03 of its potential returns per unit of risk. The Zhejiang Construction Investment is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 888.00 in Zhejiang Construction Investment on September 1, 2024 and sell it today you would earn a total of 113.00 from holding Zhejiang Construction Investment or generate 12.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.37% |
| Values | Daily Returns |
Hangzhou Huawang New vs. Zhejiang Construction Investme
Performance |
| Timeline |
| Hangzhou Huawang New |
| Zhejiang Construction |
Hangzhou Huawang and Zhejiang Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hangzhou Huawang and Zhejiang Construction
The main advantage of trading using opposite Hangzhou Huawang and Zhejiang Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hangzhou Huawang position performs unexpectedly, Zhejiang Construction 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 Zhejiang Construction will offset losses from the drop in Zhejiang Construction's long position.| Hangzhou Huawang vs. Zijin Mining Group | Hangzhou Huawang vs. Wanhua Chemical Group | Hangzhou Huawang vs. Baoshan Iron Steel | Hangzhou Huawang vs. Shandong Gold Mining |
| Zhejiang Construction vs. Industrial and Commercial | Zhejiang Construction vs. China Construction Bank | Zhejiang Construction vs. Bank of China | Zhejiang Construction vs. Agricultural Bank of |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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