Correlation Between Heilongjiang Publishing and AUPU Home
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By analyzing existing cross correlation between Heilongjiang Publishing Media and AUPU Home Style, you can compare the effects of market volatilities on Heilongjiang Publishing and AUPU Home 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 AUPU Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Publishing and AUPU Home.
Diversification Opportunities for Heilongjiang Publishing and AUPU Home
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Heilongjiang and AUPU is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Publishing Media and AUPU Home Style in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AUPU Home Style 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 AUPU Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AUPU Home Style has no effect on the direction of Heilongjiang Publishing i.e., Heilongjiang Publishing and AUPU Home go up and down completely randomly.
Pair Corralation between Heilongjiang Publishing and AUPU Home
Assuming the 90 days trading horizon Heilongjiang Publishing Media is expected to under-perform the AUPU Home. In addition to that, Heilongjiang Publishing is 2.0 times more volatile than AUPU Home Style. It trades about -0.44 of its total potential returns per unit of risk. AUPU Home Style is currently generating about -0.4 per unit of volatility. If you would invest 1,165 in AUPU Home Style on October 14, 2024 and sell it today you would lose (154.00) from holding AUPU Home Style or give up 13.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heilongjiang Publishing Media vs. AUPU Home Style
Performance |
| Timeline |
| Heilongjiang Publishing |
| AUPU Home Style |
Heilongjiang Publishing and AUPU Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Publishing and AUPU Home
The main advantage of trading using opposite Heilongjiang Publishing and AUPU Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Publishing position performs unexpectedly, AUPU Home 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 AUPU Home will offset losses from the drop in AUPU Home's long position.The idea behind Heilongjiang Publishing Media and AUPU Home Style 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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