Correlation Between China Satellite and Holitech Technology
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By analyzing existing cross correlation between China Satellite Communications and Holitech Technology Co, you can compare the effects of market volatilities on China Satellite and Holitech Technology 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 Satellite with a short position of Holitech Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Satellite and Holitech Technology.
Diversification Opportunities for China Satellite and Holitech Technology
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Holitech is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding China Satellite Communications and Holitech Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holitech Technology and China Satellite 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 Satellite Communications are associated (or correlated) with Holitech Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holitech Technology has no effect on the direction of China Satellite i.e., China Satellite and Holitech Technology go up and down completely randomly.
Pair Corralation between China Satellite and Holitech Technology
Assuming the 90 days trading horizon China Satellite is expected to generate 1.57 times less return on investment than Holitech Technology. In addition to that, China Satellite is 1.38 times more volatile than Holitech Technology Co. It trades about 0.16 of its total potential returns per unit of risk. Holitech Technology Co is currently generating about 0.35 per unit of volatility. If you would invest 127.00 in Holitech Technology Co on September 24, 2024 and sell it today you would earn a total of 123.00 from holding Holitech Technology Co or generate 96.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
China Satellite Communications vs. Holitech Technology Co
Performance |
Timeline |
China Satellite Comm |
Holitech Technology |
China Satellite and Holitech Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Satellite and Holitech Technology
The main advantage of trading using opposite China Satellite and Holitech Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Satellite position performs unexpectedly, Holitech Technology 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 Holitech Technology will offset losses from the drop in Holitech Technology's long position.China Satellite vs. Chengdu Kanghua Biological | China Satellite vs. Beijing Wantai Biological | China Satellite vs. Suzhou Novoprotein Scientific | China Satellite vs. COL Digital Publishing |
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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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