Correlation Between Qingdao Haier and ADAMA
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By analyzing existing cross correlation between Qingdao Haier Biomedical and ADAMA, you can compare the effects of market volatilities on Qingdao Haier and ADAMA 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 Qingdao Haier with a short position of ADAMA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qingdao Haier and ADAMA.
Diversification Opportunities for Qingdao Haier and ADAMA
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Qingdao and ADAMA is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Qingdao Haier Biomedical and ADAMA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADAMA and Qingdao Haier 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 Qingdao Haier Biomedical are associated (or correlated) with ADAMA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADAMA has no effect on the direction of Qingdao Haier i.e., Qingdao Haier and ADAMA go up and down completely randomly.
Pair Corralation between Qingdao Haier and ADAMA
Assuming the 90 days trading horizon Qingdao Haier Biomedical is expected to under-perform the ADAMA. In addition to that, Qingdao Haier is 1.18 times more volatile than ADAMA. It trades about 0.0 of its total potential returns per unit of risk. ADAMA is currently generating about 0.0 per unit of volatility. If you would invest 751.00 in ADAMA on September 2, 2024 and sell it today you would lose (83.00) from holding ADAMA or give up 11.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qingdao Haier Biomedical vs. ADAMA
Performance |
| Timeline |
| Qingdao Haier Biomedical |
| ADAMA |
Qingdao Haier and ADAMA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qingdao Haier and ADAMA
The main advantage of trading using opposite Qingdao Haier and ADAMA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qingdao Haier position performs unexpectedly, ADAMA 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 ADAMA will offset losses from the drop in ADAMA's long position.| Qingdao Haier vs. Jilin Chemical Fibre | Qingdao Haier vs. Zhejiang Daily Media | Qingdao Haier vs. Do Fluoride Chemicals Co | Qingdao Haier vs. Shanghai Xinhua Media |
| ADAMA vs. Southchip Semiconductor Technology | ADAMA vs. Shenwu Energy Saving | ADAMA vs. Industrial Bank Co | ADAMA vs. HeNan Splendor Science |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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