Correlation Between Qingdao Haier and Long Yuan
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By analyzing existing cross correlation between Qingdao Haier Biomedical and Long Yuan Construction, you can compare the effects of market volatilities on Qingdao Haier and Long Yuan 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 Long Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qingdao Haier and Long Yuan.
Diversification Opportunities for Qingdao Haier and Long Yuan
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Qingdao and Long is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Qingdao Haier Biomedical and Long Yuan Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Long Yuan Construction 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 Long Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Long Yuan Construction has no effect on the direction of Qingdao Haier i.e., Qingdao Haier and Long Yuan go up and down completely randomly.
Pair Corralation between Qingdao Haier and Long Yuan
Assuming the 90 days trading horizon Qingdao Haier Biomedical is expected to generate 0.8 times more return on investment than Long Yuan. However, Qingdao Haier Biomedical is 1.24 times less risky than Long Yuan. It trades about 0.13 of its potential returns per unit of risk. Long Yuan Construction is currently generating about 0.09 per unit of risk. If you would invest 3,142 in Qingdao Haier Biomedical on September 4, 2024 and sell it today you would earn a total of 232.00 from holding Qingdao Haier Biomedical or generate 7.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qingdao Haier Biomedical vs. Long Yuan Construction
Performance |
| Timeline |
| Qingdao Haier Biomedical |
| Long Yuan Construction |
Qingdao Haier and Long Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qingdao Haier and Long Yuan
The main advantage of trading using opposite Qingdao Haier and Long Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qingdao Haier position performs unexpectedly, Long Yuan 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 Long Yuan will offset losses from the drop in Long Yuan's long position.| Qingdao Haier vs. Servyou Software Group | Qingdao Haier vs. Gan Yuan Foods | Qingdao Haier vs. China National Software | Qingdao Haier vs. JuneYao Dairy Co |
| Long Yuan vs. China Life Insurance | Long Yuan vs. Cinda Securities Co | Long Yuan vs. Piotech Inc A | Long Yuan vs. Dongxing Sec Co |
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 CEOs Directory module to screen CEOs from public companies around the world.
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