Correlation Between Suzhou Mingzhi and Hengerda New
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By analyzing existing cross correlation between Suzhou Mingzhi Technology and Hengerda New Materials, you can compare the effects of market volatilities on Suzhou Mingzhi and Hengerda New 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 Suzhou Mingzhi with a short position of Hengerda New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suzhou Mingzhi and Hengerda New.
Diversification Opportunities for Suzhou Mingzhi and Hengerda New
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Suzhou and Hengerda is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Suzhou Mingzhi Technology and Hengerda New Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hengerda New Materials and Suzhou Mingzhi 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 Suzhou Mingzhi Technology are associated (or correlated) with Hengerda New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hengerda New Materials has no effect on the direction of Suzhou Mingzhi i.e., Suzhou Mingzhi and Hengerda New go up and down completely randomly.
Pair Corralation between Suzhou Mingzhi and Hengerda New
Assuming the 90 days trading horizon Suzhou Mingzhi is expected to generate 1.06 times less return on investment than Hengerda New. But when comparing it to its historical volatility, Suzhou Mingzhi Technology is 1.03 times less risky than Hengerda New. It trades about 0.01 of its potential returns per unit of risk. Hengerda New Materials is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 3,369 in Hengerda New Materials on September 12, 2024 and sell it today you would lose (349.00) from holding Hengerda New Materials or give up 10.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Suzhou Mingzhi Technology vs. Hengerda New Materials
Performance |
| Timeline |
| Suzhou Mingzhi Technology |
| Hengerda New Materials |
Suzhou Mingzhi and Hengerda New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suzhou Mingzhi and Hengerda New
The main advantage of trading using opposite Suzhou Mingzhi and Hengerda New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suzhou Mingzhi position performs unexpectedly, Hengerda New 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 Hengerda New will offset losses from the drop in Hengerda New's long position.| Suzhou Mingzhi vs. Hengerda New Materials | Suzhou Mingzhi vs. Jinsanjiang Silicon Material | Suzhou Mingzhi vs. Ningxia Building Materials | Suzhou Mingzhi vs. Guangzhou Zhujiang Brewery |
| Hengerda New vs. Agricultural Bank of | Hengerda New vs. Industrial and Commercial | Hengerda New vs. Bank of China | Hengerda New vs. PetroChina Co Ltd |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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