Correlation Between Greenland Technologies and Next Hydrogen

Can any of the company-specific risk be diversified away by investing in both Greenland Technologies and Next Hydrogen at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Greenland Technologies and Next Hydrogen into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Greenland Technologies Holding and Next Hydrogen Solutions, you can compare the effects of market volatilities on Greenland Technologies and Next Hydrogen 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 Greenland Technologies with a short position of Next Hydrogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenland Technologies and Next Hydrogen.

Diversification Opportunities for Greenland Technologies and Next Hydrogen

-0.07

Correlation Coefficient

Greenland Technologies  Next Hydrogen

Good diversification

The 3 months correlation between Greenland and Next is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Greenland Technologies Holding and Next Hydrogen Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Next Hydrogen Solutions and Greenland Technologies 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 Greenland Technologies Holding are associated (or correlated) with Next Hydrogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Next Hydrogen Solutions has no effect on the direction of Greenland Technologies i.e., Greenland Technologies and Next Hydrogen go up and down completely randomly.

Pair Corralation between Greenland Technologies and Next Hydrogen

If you would invest  29.00  in Next Hydrogen Solutions on September 13, 2024 and sell it today you would earn a total of  1.00  from holding Next Hydrogen Solutions or generate 3.45% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.59%
Values	Daily Returns

Greenland Technologies Holding  vs.  Next Hydrogen Solutions

Greenland Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Greenland Technologies Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable fundamental indicators, Greenland Technologies is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Next Hydrogen Solutions

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Next Hydrogen Solutions are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Next Hydrogen reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Greenland Technologies and Next Hydrogen

The main advantage of trading using opposite Greenland Technologies and Next Hydrogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greenland Technologies position performs unexpectedly, Next Hydrogen 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 Next Hydrogen will offset losses from the drop in Next Hydrogen's long position.

The idea behind Greenland Technologies Holding and Next Hydrogen Solutions pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.