Correlation Between Heilongjiang Publishing and Southern PublishingMedia
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By analyzing existing cross correlation between Heilongjiang Publishing Media and Southern PublishingMedia Co, you can compare the effects of market volatilities on Heilongjiang Publishing and Southern PublishingMedia 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 Southern PublishingMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Publishing and Southern PublishingMedia.
Diversification Opportunities for Heilongjiang Publishing and Southern PublishingMedia
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Heilongjiang and Southern is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Publishing Media and Southern PublishingMedia Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern PublishingMedia 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 Southern PublishingMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern PublishingMedia has no effect on the direction of Heilongjiang Publishing i.e., Heilongjiang Publishing and Southern PublishingMedia go up and down completely randomly.
Pair Corralation between Heilongjiang Publishing and Southern PublishingMedia
Assuming the 90 days trading horizon Heilongjiang Publishing Media is expected to generate 1.04 times more return on investment than Southern PublishingMedia. However, Heilongjiang Publishing is 1.04 times more volatile than Southern PublishingMedia Co. It trades about 0.16 of its potential returns per unit of risk. Southern PublishingMedia Co is currently generating about 0.15 per unit of risk. If you would invest 1,253 in Heilongjiang Publishing Media on September 2, 2024 and sell it today you would earn a total of 427.00 from holding Heilongjiang Publishing Media or generate 34.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heilongjiang Publishing Media vs. Southern PublishingMedia Co
Performance |
| Timeline |
| Heilongjiang Publishing |
| Southern PublishingMedia |
Heilongjiang Publishing and Southern PublishingMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Publishing and Southern PublishingMedia
The main advantage of trading using opposite Heilongjiang Publishing and Southern PublishingMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Publishing position performs unexpectedly, Southern PublishingMedia 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 Southern PublishingMedia will offset losses from the drop in Southern PublishingMedia's long position.The idea behind Heilongjiang Publishing Media and Southern PublishingMedia Co 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.
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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