Correlation Between Heilongjiang Publishing and Luyin Investment
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By analyzing existing cross correlation between Heilongjiang Publishing Media and Luyin Investment Group, you can compare the effects of market volatilities on Heilongjiang Publishing and Luyin Investment 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 Heilongjiang Publishing with a short position of Luyin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Publishing and Luyin Investment.
Diversification Opportunities for Heilongjiang Publishing and Luyin Investment
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Heilongjiang and Luyin is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Publishing Media and Luyin Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luyin Investment and Heilongjiang Publishing 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 Heilongjiang Publishing Media are associated (or correlated) with Luyin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luyin Investment has no effect on the direction of Heilongjiang Publishing i.e., Heilongjiang Publishing and Luyin Investment go up and down completely randomly.
Pair Corralation between Heilongjiang Publishing and Luyin Investment
Assuming the 90 days trading horizon Heilongjiang Publishing Media is expected to under-perform the Luyin Investment. In addition to that, Heilongjiang Publishing is 1.69 times more volatile than Luyin Investment Group. It trades about -0.02 of its total potential returns per unit of risk. Luyin Investment Group is currently generating about 0.0 per unit of volatility. If you would invest 615.00 in Luyin Investment Group on August 25, 2024 and sell it today you would lose (30.00) from holding Luyin Investment Group or give up 4.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heilongjiang Publishing Media vs. Luyin Investment Group
Performance |
| Timeline |
| Heilongjiang Publishing |
| Luyin Investment |
Heilongjiang Publishing and Luyin Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Publishing and Luyin Investment
The main advantage of trading using opposite Heilongjiang Publishing and Luyin Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Publishing position performs unexpectedly, Luyin Investment 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 Luyin Investment will offset losses from the drop in Luyin Investment's long position.The idea behind Heilongjiang Publishing Media and Luyin Investment Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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