Correlation Between Eastroc Beverage and HaiXin Foods
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By analyzing existing cross correlation between Eastroc Beverage Group and HaiXin Foods Co, you can compare the effects of market volatilities on Eastroc Beverage and HaiXin Foods 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 Eastroc Beverage with a short position of HaiXin Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastroc Beverage and HaiXin Foods.
Diversification Opportunities for Eastroc Beverage and HaiXin Foods
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Eastroc and HaiXin is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Eastroc Beverage Group and HaiXin Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HaiXin Foods and Eastroc Beverage 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 Eastroc Beverage Group are associated (or correlated) with HaiXin Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HaiXin Foods has no effect on the direction of Eastroc Beverage i.e., Eastroc Beverage and HaiXin Foods go up and down completely randomly.
Pair Corralation between Eastroc Beverage and HaiXin Foods
Assuming the 90 days trading horizon Eastroc Beverage is expected to generate 1.8 times less return on investment than HaiXin Foods. But when comparing it to its historical volatility, Eastroc Beverage Group is 1.52 times less risky than HaiXin Foods. It trades about 0.13 of its potential returns per unit of risk. HaiXin Foods Co is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 352.00 in HaiXin Foods Co on August 28, 2024 and sell it today you would earn a total of 79.00 from holding HaiXin Foods Co or generate 22.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastroc Beverage Group vs. HaiXin Foods Co
Performance |
| Timeline |
| Eastroc Beverage |
| HaiXin Foods |
Eastroc Beverage and HaiXin Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastroc Beverage and HaiXin Foods
The main advantage of trading using opposite Eastroc Beverage and HaiXin Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastroc Beverage position performs unexpectedly, HaiXin Foods 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 HaiXin Foods will offset losses from the drop in HaiXin Foods' long position.| Eastroc Beverage vs. China Petroleum Chemical | Eastroc Beverage vs. PetroChina Co Ltd | Eastroc Beverage vs. China State Construction | Eastroc Beverage vs. China Railway Group |
| HaiXin Foods vs. China Petroleum Chemical | HaiXin Foods vs. PetroChina Co Ltd | HaiXin Foods vs. China State Construction | HaiXin Foods vs. China Railway 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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