Correlation Between China Mengniu and HydroGraph Clean
Can any of the company-specific risk be diversified away by investing in both China Mengniu and HydroGraph Clean at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining China Mengniu and HydroGraph Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Mengniu Dairy and HydroGraph Clean Power, you can compare the effects of market volatilities on China Mengniu and HydroGraph Clean 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 China Mengniu with a short position of HydroGraph Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mengniu and HydroGraph Clean.
Diversification Opportunities for China Mengniu and HydroGraph Clean
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between China and HydroGraph is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding China Mengniu Dairy and HydroGraph Clean Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HydroGraph Clean Power and China Mengniu 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 China Mengniu Dairy are associated (or correlated) with HydroGraph Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HydroGraph Clean Power has no effect on the direction of China Mengniu i.e., China Mengniu and HydroGraph Clean go up and down completely randomly.
Pair Corralation between China Mengniu and HydroGraph Clean
If you would invest 2,265 in China Mengniu Dairy on September 3, 2024 and sell it today you would earn a total of 25.00 from holding China Mengniu Dairy or generate 1.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
China Mengniu Dairy vs. HydroGraph Clean Power
Performance |
| Timeline |
| China Mengniu Dairy |
| HydroGraph Clean Power |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
China Mengniu and HydroGraph Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mengniu and HydroGraph Clean
The main advantage of trading using opposite China Mengniu and HydroGraph Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mengniu position performs unexpectedly, HydroGraph Clean 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 HydroGraph Clean will offset losses from the drop in HydroGraph Clean's long position.| China Mengniu vs. Nestle SA ADR | China Mengniu vs. ConAgra Foods | China Mengniu vs. Hormel Foods | China Mengniu vs. Kraft Heinz Co |
| HydroGraph Clean vs. G6 Materials Corp | HydroGraph Clean vs. Nano One Materials | HydroGraph Clean vs. Haydale Graphene Industries | HydroGraph Clean vs. Orica Ltd ADR |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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