Correlation Between Gem Year and Huatian Hotel
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By analyzing existing cross correlation between Gem Year Industrial Co and Huatian Hotel Group, you can compare the effects of market volatilities on Gem Year and Huatian Hotel 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 Gem Year with a short position of Huatian Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gem Year and Huatian Hotel.
Diversification Opportunities for Gem Year and Huatian Hotel
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gem and Huatian is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Gem Year Industrial Co and Huatian Hotel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huatian Hotel Group and Gem Year 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 Gem Year Industrial Co are associated (or correlated) with Huatian Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huatian Hotel Group has no effect on the direction of Gem Year i.e., Gem Year and Huatian Hotel go up and down completely randomly.
Pair Corralation between Gem Year and Huatian Hotel
Assuming the 90 days trading horizon Gem Year Industrial Co is expected to generate 0.81 times more return on investment than Huatian Hotel. However, Gem Year Industrial Co is 1.24 times less risky than Huatian Hotel. It trades about 0.03 of its potential returns per unit of risk. Huatian Hotel Group is currently generating about -0.06 per unit of risk. If you would invest 440.00 in Gem Year Industrial Co on October 31, 2024 and sell it today you would earn a total of 9.00 from holding Gem Year Industrial Co or generate 2.05% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Gem Year Industrial Co vs. Huatian Hotel Group
Performance |
Timeline |
Gem Year Industrial |
Huatian Hotel Group |
Gem Year and Huatian Hotel Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Gem Year and Huatian Hotel
The main advantage of trading using opposite Gem Year and Huatian Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gem Year position performs unexpectedly, Huatian Hotel 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 Huatian Hotel will offset losses from the drop in Huatian Hotel's long position.Gem Year vs. Giantec Semiconductor Corp | ||
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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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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