Correlation Between Guangdong Qunxing and HaiXin Foods
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By analyzing existing cross correlation between Guangdong Qunxing Toys and HaiXin Foods Co, you can compare the effects of market volatilities on Guangdong Qunxing and HaiXin Foods 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 Guangdong Qunxing with a short position of HaiXin Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Qunxing and HaiXin Foods.
Diversification Opportunities for Guangdong Qunxing and HaiXin Foods
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangdong and HaiXin is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Qunxing Toys and HaiXin Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HaiXin Foods and Guangdong Qunxing 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 Guangdong Qunxing Toys are associated (or correlated) with HaiXin Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HaiXin Foods has no effect on the direction of Guangdong Qunxing i.e., Guangdong Qunxing and HaiXin Foods go up and down completely randomly.
Pair Corralation between Guangdong Qunxing and HaiXin Foods
Assuming the 90 days trading horizon Guangdong Qunxing Toys is expected to generate 0.75 times more return on investment than HaiXin Foods. However, Guangdong Qunxing Toys is 1.32 times less risky than HaiXin Foods. It trades about 0.2 of its potential returns per unit of risk. HaiXin Foods Co is currently generating about -0.04 per unit of risk. If you would invest 690.00 in Guangdong Qunxing Toys on October 3, 2024 and sell it today you would earn a total of 134.00 from holding Guangdong Qunxing Toys or generate 19.42% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Guangdong Qunxing Toys vs. HaiXin Foods Co
Performance |
Timeline |
Guangdong Qunxing Toys |
HaiXin Foods |
Guangdong Qunxing and HaiXin Foods Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guangdong Qunxing and HaiXin Foods
The main advantage of trading using opposite Guangdong Qunxing and HaiXin Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Qunxing position performs unexpectedly, HaiXin Foods 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 HaiXin Foods will offset losses from the drop in HaiXin Foods' long position.Guangdong Qunxing vs. Shanghai Yanpu Metal | Guangdong Qunxing vs. Rising Nonferrous Metals | Guangdong Qunxing vs. Anhui Transport Consulting | Guangdong Qunxing vs. Western Mining Co |
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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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