Correlation Between Shenzhen Centralcon and Xiandai Investment
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By analyzing existing cross correlation between Shenzhen Centralcon Investment and Xiandai Investment Co, you can compare the effects of market volatilities on Shenzhen Centralcon and Xiandai Investment 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 Shenzhen Centralcon with a short position of Xiandai Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Centralcon and Xiandai Investment.
Diversification Opportunities for Shenzhen Centralcon and Xiandai Investment
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shenzhen and Xiandai is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Centralcon Investment and Xiandai Investment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiandai Investment and Shenzhen Centralcon 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 Shenzhen Centralcon Investment are associated (or correlated) with Xiandai Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiandai Investment has no effect on the direction of Shenzhen Centralcon i.e., Shenzhen Centralcon and Xiandai Investment go up and down completely randomly.
Pair Corralation between Shenzhen Centralcon and Xiandai Investment
Assuming the 90 days trading horizon Shenzhen Centralcon is expected to generate 3.66 times less return on investment than Xiandai Investment. But when comparing it to its historical volatility, Shenzhen Centralcon Investment is 1.18 times less risky than Xiandai Investment. It trades about 0.06 of its potential returns per unit of risk. Xiandai Investment Co is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 414.00 in Xiandai Investment Co on September 1, 2024 and sell it today you would earn a total of 48.00 from holding Xiandai Investment Co or generate 11.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Centralcon Investment vs. Xiandai Investment Co
Performance |
| Timeline |
| Shenzhen Centralcon |
| Xiandai Investment |
Shenzhen Centralcon and Xiandai Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Centralcon and Xiandai Investment
The main advantage of trading using opposite Shenzhen Centralcon and Xiandai Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Centralcon position performs unexpectedly, Xiandai Investment 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 Xiandai Investment will offset losses from the drop in Xiandai Investment's long position.| Shenzhen Centralcon vs. Anhui Huilong Agricultural | Shenzhen Centralcon vs. Huitong Construction Group | Shenzhen Centralcon vs. Kuangda Technology Group | Shenzhen Centralcon vs. Allied Machinery Co |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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