Correlation Between XCMG Construction and Changchun Engley
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By analyzing existing cross correlation between XCMG Construction Machinery and Changchun Engley Automobile, you can compare the effects of market volatilities on XCMG Construction and Changchun Engley 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 XCMG Construction with a short position of Changchun Engley. Check out your portfolio center. Please also check ongoing floating volatility patterns of XCMG Construction and Changchun Engley.
Diversification Opportunities for XCMG Construction and Changchun Engley
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between XCMG and Changchun is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding XCMG Construction Machinery and Changchun Engley Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun Engley Aut and XCMG Construction 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 XCMG Construction Machinery are associated (or correlated) with Changchun Engley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun Engley Aut has no effect on the direction of XCMG Construction i.e., XCMG Construction and Changchun Engley go up and down completely randomly.
Pair Corralation between XCMG Construction and Changchun Engley
Assuming the 90 days trading horizon XCMG Construction Machinery is expected to generate 0.59 times more return on investment than Changchun Engley. However, XCMG Construction Machinery is 1.7 times less risky than Changchun Engley. It trades about 0.07 of its potential returns per unit of risk. Changchun Engley Automobile is currently generating about -0.1 per unit of risk. If you would invest 757.00 in XCMG Construction Machinery on October 24, 2024 and sell it today you would earn a total of 17.00 from holding XCMG Construction Machinery or generate 2.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
XCMG Construction Machinery vs. Changchun Engley Automobile
Performance |
| Timeline |
| XCMG Construction |
| Changchun Engley Aut |
XCMG Construction and Changchun Engley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XCMG Construction and Changchun Engley
The main advantage of trading using opposite XCMG Construction and Changchun Engley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XCMG Construction position performs unexpectedly, Changchun Engley 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 Changchun Engley will offset losses from the drop in Changchun Engley's long position.| XCMG Construction vs. China National Software | XCMG Construction vs. Xiamen Goldenhome Co | XCMG Construction vs. Nanjing OLO Home | XCMG Construction vs. Shanghai Newtouch Software |
| Changchun Engley vs. Suzhou Oriental Semiconductor | Changchun Engley vs. Shanghai Newtouch Software | Changchun Engley vs. StarPower Semiconductor | Changchun Engley vs. Suzhou Douson Drilling |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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