Correlation Between Hangzhou Huawang and Tjk Machinery
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By analyzing existing cross correlation between Hangzhou Huawang New and Tjk Machinery Tianjin, you can compare the effects of market volatilities on Hangzhou Huawang and Tjk Machinery 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 Hangzhou Huawang with a short position of Tjk Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hangzhou Huawang and Tjk Machinery.
Diversification Opportunities for Hangzhou Huawang and Tjk Machinery
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hangzhou and Tjk is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Hangzhou Huawang New and Tjk Machinery Tianjin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tjk Machinery Tianjin and Hangzhou Huawang 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 Hangzhou Huawang New are associated (or correlated) with Tjk Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tjk Machinery Tianjin has no effect on the direction of Hangzhou Huawang i.e., Hangzhou Huawang and Tjk Machinery go up and down completely randomly.
Pair Corralation between Hangzhou Huawang and Tjk Machinery
Assuming the 90 days trading horizon Hangzhou Huawang is expected to generate 2.54 times less return on investment than Tjk Machinery. But when comparing it to its historical volatility, Hangzhou Huawang New is 1.61 times less risky than Tjk Machinery. It trades about 0.07 of its potential returns per unit of risk. Tjk Machinery Tianjin is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,095 in Tjk Machinery Tianjin on September 26, 2024 and sell it today you would earn a total of 257.00 from holding Tjk Machinery Tianjin or generate 23.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 98.33% |
Values | Daily Returns |
Hangzhou Huawang New vs. Tjk Machinery Tianjin
Performance |
Timeline |
Hangzhou Huawang New |
Tjk Machinery Tianjin |
Hangzhou Huawang and Tjk Machinery Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hangzhou Huawang and Tjk Machinery
The main advantage of trading using opposite Hangzhou Huawang and Tjk Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hangzhou Huawang position performs unexpectedly, Tjk Machinery 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 Tjk Machinery will offset losses from the drop in Tjk Machinery's long position.Hangzhou Huawang vs. Zijin Mining Group | Hangzhou Huawang vs. Wanhua Chemical Group | Hangzhou Huawang vs. Baoshan Iron Steel | Hangzhou Huawang vs. Shandong Gold Mining |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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