Correlation Between Qingdao Haier and City Development
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By analyzing existing cross correlation between Qingdao Haier Biomedical and City Development Environment, you can compare the effects of market volatilities on Qingdao Haier and City Development 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 City Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qingdao Haier and City Development.
Diversification Opportunities for Qingdao Haier and City Development
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Qingdao and City is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Qingdao Haier Biomedical and City Development Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on City Development Env 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 City Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of City Development Env has no effect on the direction of Qingdao Haier i.e., Qingdao Haier and City Development go up and down completely randomly.
Pair Corralation between Qingdao Haier and City Development
Assuming the 90 days trading horizon Qingdao Haier Biomedical is expected to under-perform the City Development. In addition to that, Qingdao Haier is 2.82 times more volatile than City Development Environment. It trades about -0.17 of its total potential returns per unit of risk. City Development Environment is currently generating about 0.09 per unit of volatility. If you would invest 1,264 in City Development Environment on November 7, 2024 and sell it today you would earn a total of 19.00 from holding City Development Environment or generate 1.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qingdao Haier Biomedical vs. City Development Environment
Performance |
| Timeline |
| Qingdao Haier Biomedical |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| City Development Env |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Qingdao Haier and City Development Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qingdao Haier and City Development
The main advantage of trading using opposite Qingdao Haier and City Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qingdao Haier position performs unexpectedly, City Development 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 City Development will offset losses from the drop in City Development's long position.The idea behind Qingdao Haier Biomedical and City Development Environment 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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