Correlation Between Yindu Kitchen and Huatian Hotel
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By analyzing existing cross correlation between Yindu Kitchen Equipment and Huatian Hotel Group, you can compare the effects of market volatilities on Yindu Kitchen 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 Yindu Kitchen with a short position of Huatian Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yindu Kitchen and Huatian Hotel.
Diversification Opportunities for Yindu Kitchen and Huatian Hotel
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Yindu and Huatian is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Yindu Kitchen Equipment 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 Yindu Kitchen 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 Yindu Kitchen Equipment 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 Yindu Kitchen i.e., Yindu Kitchen and Huatian Hotel go up and down completely randomly.
Pair Corralation between Yindu Kitchen and Huatian Hotel
Assuming the 90 days trading horizon Yindu Kitchen Equipment is expected to under-perform the Huatian Hotel. But the stock apears to be less risky and, when comparing its historical volatility, Yindu Kitchen Equipment is 1.58 times less risky than Huatian Hotel. The stock trades about -0.16 of its potential returns per unit of risk. The Huatian Hotel Group is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 360.00 in Huatian Hotel Group on October 8, 2024 and sell it today you would lose (55.00) from holding Huatian Hotel Group or give up 15.28% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Yindu Kitchen Equipment vs. Huatian Hotel Group
Performance |
Timeline |
Yindu Kitchen Equipment |
Huatian Hotel Group |
Yindu Kitchen and Huatian Hotel Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Yindu Kitchen and Huatian Hotel
The main advantage of trading using opposite Yindu Kitchen and Huatian Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yindu Kitchen 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.Yindu Kitchen vs. Biwin Storage Technology | Yindu Kitchen vs. PetroChina Co Ltd | Yindu Kitchen vs. Industrial and Commercial | Yindu Kitchen vs. China Construction Bank |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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