Correlation Between HanS Laser and Qumei Furniture
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By analyzing existing cross correlation between HanS Laser Tech and Qumei Furniture Group, you can compare the effects of market volatilities on HanS Laser and Qumei Furniture 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 HanS Laser with a short position of Qumei Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of HanS Laser and Qumei Furniture.
Diversification Opportunities for HanS Laser and Qumei Furniture
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between HanS and Qumei is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding HanS Laser Tech and Qumei Furniture Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qumei Furniture Group and HanS Laser 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 HanS Laser Tech are associated (or correlated) with Qumei Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qumei Furniture Group has no effect on the direction of HanS Laser i.e., HanS Laser and Qumei Furniture go up and down completely randomly.
Pair Corralation between HanS Laser and Qumei Furniture
Assuming the 90 days trading horizon HanS Laser Tech is expected to generate 0.85 times more return on investment than Qumei Furniture. However, HanS Laser Tech is 1.18 times less risky than Qumei Furniture. It trades about 0.15 of its potential returns per unit of risk. Qumei Furniture Group is currently generating about 0.09 per unit of risk. If you would invest 2,008 in HanS Laser Tech on September 26, 2024 and sell it today you would earn a total of 591.00 from holding HanS Laser Tech or generate 29.43% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
HanS Laser Tech vs. Qumei Furniture Group
Performance |
Timeline |
HanS Laser Tech |
Qumei Furniture Group |
HanS Laser and Qumei Furniture Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with HanS Laser and Qumei Furniture
The main advantage of trading using opposite HanS Laser and Qumei Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HanS Laser position performs unexpectedly, Qumei Furniture 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 Qumei Furniture will offset losses from the drop in Qumei Furniture's long position.HanS Laser vs. Bank of China | HanS Laser vs. Kweichow Moutai Co | HanS Laser vs. PetroChina Co Ltd | HanS Laser vs. Bank of Communications |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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