Correlation Between Hunan Investment and Linewell Software
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By analyzing existing cross correlation between Hunan Investment Group and Linewell Software Co, you can compare the effects of market volatilities on Hunan Investment and Linewell Software 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 Hunan Investment with a short position of Linewell Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunan Investment and Linewell Software.
Diversification Opportunities for Hunan Investment and Linewell Software
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hunan and Linewell is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Hunan Investment Group and Linewell Software Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Linewell Software and Hunan Investment 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 Hunan Investment Group are associated (or correlated) with Linewell Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Linewell Software has no effect on the direction of Hunan Investment i.e., Hunan Investment and Linewell Software go up and down completely randomly.
Pair Corralation between Hunan Investment and Linewell Software
Assuming the 90 days trading horizon Hunan Investment Group is expected to generate 0.8 times more return on investment than Linewell Software. However, Hunan Investment Group is 1.26 times less risky than Linewell Software. It trades about 0.23 of its potential returns per unit of risk. Linewell Software Co is currently generating about 0.16 per unit of risk. If you would invest 398.00 in Hunan Investment Group on September 12, 2024 and sell it today you would earn a total of 200.00 from holding Hunan Investment Group or generate 50.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 98.28% |
Values | Daily Returns |
Hunan Investment Group vs. Linewell Software Co
Performance |
Timeline |
Hunan Investment |
Linewell Software |
Hunan Investment and Linewell Software Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hunan Investment and Linewell Software
The main advantage of trading using opposite Hunan Investment and Linewell Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunan Investment position performs unexpectedly, Linewell Software 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 Linewell Software will offset losses from the drop in Linewell Software's long position.Hunan Investment vs. Agricultural Bank of | Hunan Investment vs. Industrial and Commercial | Hunan Investment vs. Bank of China | Hunan Investment vs. PetroChina Co Ltd |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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