Correlation Between Hunan Investment and Xinke Material
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By analyzing existing cross correlation between Hunan Investment Group and Xinke Material, you can compare the effects of market volatilities on Hunan Investment and Xinke Material 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 Hunan Investment with a short position of Xinke Material. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunan Investment and Xinke Material.
Diversification Opportunities for Hunan Investment and Xinke Material
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hunan and Xinke is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Hunan Investment Group and Xinke Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinke Material and Hunan Investment 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 Hunan Investment Group are associated (or correlated) with Xinke Material. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinke Material has no effect on the direction of Hunan Investment i.e., Hunan Investment and Xinke Material go up and down completely randomly.
Pair Corralation between Hunan Investment and Xinke Material
Assuming the 90 days trading horizon Hunan Investment Group is expected to generate 1.03 times more return on investment than Xinke Material. However, Hunan Investment is 1.03 times more volatile than Xinke Material. It trades about 0.03 of its potential returns per unit of risk. Xinke Material is currently generating about 0.01 per unit of risk. If you would invest 491.00 in Hunan Investment Group on September 4, 2024 and sell it today you would earn a total of 90.00 from holding Hunan Investment Group or generate 18.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hunan Investment Group vs. Xinke Material
Performance |
| Timeline |
| Hunan Investment |
| Xinke Material |
Hunan Investment and Xinke Material Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hunan Investment and Xinke Material
The main advantage of trading using opposite Hunan Investment and Xinke Material positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunan Investment position performs unexpectedly, Xinke Material 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 Xinke Material will offset losses from the drop in Xinke Material's long position.| Hunan Investment vs. Hubeiyichang Transportation Group | Hunan Investment vs. Hainan Haiqi Transportation | Hunan Investment vs. Zhengping RoadBridge Constr | Hunan Investment vs. Great Sun Foods Co |
| Xinke Material vs. Zijin Mining Group | Xinke Material vs. Wanhua Chemical Group | Xinke Material vs. Baoshan Iron Steel | Xinke Material vs. Rongsheng Petrochemical 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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