Correlation Between ACM Research and Huagong Tech
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By analyzing existing cross correlation between ACM Research Shanghai and Huagong Tech Co, you can compare the effects of market volatilities on ACM Research and Huagong Tech 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 ACM Research with a short position of Huagong Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACM Research and Huagong Tech.
Diversification Opportunities for ACM Research and Huagong Tech
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ACM and Huagong is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding ACM Research Shanghai and Huagong Tech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huagong Tech and ACM Research 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 ACM Research Shanghai are associated (or correlated) with Huagong Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huagong Tech has no effect on the direction of ACM Research i.e., ACM Research and Huagong Tech go up and down completely randomly.
Pair Corralation between ACM Research and Huagong Tech
Assuming the 90 days trading horizon ACM Research is expected to generate 2.87 times less return on investment than Huagong Tech. But when comparing it to its historical volatility, ACM Research Shanghai is 1.08 times less risky than Huagong Tech. It trades about 0.02 of its potential returns per unit of risk. Huagong Tech Co is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,866 in Huagong Tech Co on October 15, 2024 and sell it today you would earn a total of 1,931 from holding Huagong Tech Co or generate 103.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
ACM Research Shanghai vs. Huagong Tech Co
Performance |
| Timeline |
| ACM Research Shanghai |
| Huagong Tech |
ACM Research and Huagong Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ACM Research and Huagong Tech
The main advantage of trading using opposite ACM Research and Huagong Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACM Research position performs unexpectedly, Huagong Tech 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 Huagong Tech will offset losses from the drop in Huagong Tech's long position.| ACM Research vs. Shenzhen Topway Video | ACM Research vs. Emdoor Information Co | ACM Research vs. Kidswant Children Products | ACM Research vs. Chinese Universe Publishing |
| Huagong Tech vs. Biwin Storage Technology | Huagong Tech vs. PetroChina Co Ltd | Huagong Tech vs. Industrial and Commercial | Huagong Tech vs. China Construction Bank |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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