Correlation Between Shanghai Rightongene and Huitong Construction
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By analyzing existing cross correlation between Shanghai Rightongene Biotechnology and Huitong Construction Group, you can compare the effects of market volatilities on Shanghai Rightongene and Huitong Construction 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 Shanghai Rightongene with a short position of Huitong Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Rightongene and Huitong Construction.
Diversification Opportunities for Shanghai Rightongene and Huitong Construction
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shanghai and Huitong is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Rightongene Biotechno and Huitong Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huitong Construction and Shanghai Rightongene 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 Shanghai Rightongene Biotechnology are associated (or correlated) with Huitong Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huitong Construction has no effect on the direction of Shanghai Rightongene i.e., Shanghai Rightongene and Huitong Construction go up and down completely randomly.
Pair Corralation between Shanghai Rightongene and Huitong Construction
Assuming the 90 days trading horizon Shanghai Rightongene Biotechnology is expected to generate 1.71 times more return on investment than Huitong Construction. However, Shanghai Rightongene is 1.71 times more volatile than Huitong Construction Group. It trades about 0.11 of its potential returns per unit of risk. Huitong Construction Group is currently generating about 0.09 per unit of risk. If you would invest 1,941 in Shanghai Rightongene Biotechnology on September 1, 2024 and sell it today you would earn a total of 148.00 from holding Shanghai Rightongene Biotechnology or generate 7.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Rightongene Biotechno vs. Huitong Construction Group
Performance |
| Timeline |
| Shanghai Rightongene |
| Huitong Construction |
Shanghai Rightongene and Huitong Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Rightongene and Huitong Construction
The main advantage of trading using opposite Shanghai Rightongene and Huitong Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Rightongene position performs unexpectedly, Huitong Construction 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 Huitong Construction will offset losses from the drop in Huitong Construction's long position.| Shanghai Rightongene vs. PetroChina Co Ltd | Shanghai Rightongene vs. China Mobile Limited | Shanghai Rightongene vs. CNOOC Limited | Shanghai Rightongene vs. Ping An Insurance |
| Huitong Construction vs. 159681 | Huitong Construction vs. 159005 | Huitong Construction vs. Loctek Ergonomic Technology | Huitong Construction vs. 516220 |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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