Correlation Between Tibet Huayu and Guangzhou Haige
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By analyzing existing cross correlation between Tibet Huayu Mining and Guangzhou Haige Communications, you can compare the effects of market volatilities on Tibet Huayu and Guangzhou Haige 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 Tibet Huayu with a short position of Guangzhou Haige. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tibet Huayu and Guangzhou Haige.
Diversification Opportunities for Tibet Huayu and Guangzhou Haige
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tibet and Guangzhou is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Tibet Huayu Mining and Guangzhou Haige Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Haige Comm and Tibet Huayu 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 Tibet Huayu Mining are associated (or correlated) with Guangzhou Haige. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Haige Comm has no effect on the direction of Tibet Huayu i.e., Tibet Huayu and Guangzhou Haige go up and down completely randomly.
Pair Corralation between Tibet Huayu and Guangzhou Haige
Assuming the 90 days trading horizon Tibet Huayu Mining is expected to generate 1.29 times more return on investment than Guangzhou Haige. However, Tibet Huayu is 1.29 times more volatile than Guangzhou Haige Communications. It trades about 0.05 of its potential returns per unit of risk. Guangzhou Haige Communications is currently generating about 0.04 per unit of risk. If you would invest 843.00 in Tibet Huayu Mining on September 26, 2024 and sell it today you would earn a total of 487.00 from holding Tibet Huayu Mining or generate 57.77% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Tibet Huayu Mining vs. Guangzhou Haige Communications
Performance |
Timeline |
Tibet Huayu Mining |
Guangzhou Haige Comm |
Tibet Huayu and Guangzhou Haige Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tibet Huayu and Guangzhou Haige
The main advantage of trading using opposite Tibet Huayu and Guangzhou Haige positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tibet Huayu position performs unexpectedly, Guangzhou Haige 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 Guangzhou Haige will offset losses from the drop in Guangzhou Haige's long position.Tibet Huayu vs. Zijin Mining Group | Tibet Huayu vs. Wanhua Chemical Group | Tibet Huayu vs. Baoshan Iron Steel | Tibet Huayu vs. Shandong Gold Mining |
Guangzhou Haige vs. Industrial and Commercial | Guangzhou Haige vs. Agricultural Bank of | Guangzhou Haige vs. China Construction Bank | Guangzhou Haige vs. Bank of China |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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