Correlation Between Chengdu Xingrong and Yindu Kitchen
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By analyzing existing cross correlation between Chengdu Xingrong Investment and Yindu Kitchen Equipment, you can compare the effects of market volatilities on Chengdu Xingrong and Yindu Kitchen 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 Chengdu Xingrong with a short position of Yindu Kitchen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Xingrong and Yindu Kitchen.
Diversification Opportunities for Chengdu Xingrong and Yindu Kitchen
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chengdu and Yindu is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Xingrong Investment and Yindu Kitchen Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yindu Kitchen Equipment and Chengdu Xingrong 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 Chengdu Xingrong Investment are associated (or correlated) with Yindu Kitchen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yindu Kitchen Equipment has no effect on the direction of Chengdu Xingrong i.e., Chengdu Xingrong and Yindu Kitchen go up and down completely randomly.
Pair Corralation between Chengdu Xingrong and Yindu Kitchen
Assuming the 90 days trading horizon Chengdu Xingrong Investment is expected to under-perform the Yindu Kitchen. But the stock apears to be less risky and, when comparing its historical volatility, Chengdu Xingrong Investment is 1.71 times less risky than Yindu Kitchen. The stock trades about -0.04 of its potential returns per unit of risk. The Yindu Kitchen Equipment is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 2,268 in Yindu Kitchen Equipment on November 3, 2024 and sell it today you would earn a total of 297.00 from holding Yindu Kitchen Equipment or generate 13.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Xingrong Investment vs. Yindu Kitchen Equipment
Performance |
| Timeline |
| Chengdu Xingrong Inv |
| Yindu Kitchen Equipment |
Chengdu Xingrong and Yindu Kitchen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Xingrong and Yindu Kitchen
The main advantage of trading using opposite Chengdu Xingrong and Yindu Kitchen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Xingrong position performs unexpectedly, Yindu Kitchen 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 Yindu Kitchen will offset losses from the drop in Yindu Kitchen's long position.| Chengdu Xingrong vs. Shenzhen Centralcon Investment | Chengdu Xingrong vs. Bingo Software Co | Chengdu Xingrong vs. Xiamen Insight Investment | Chengdu Xingrong vs. Fujian Boss Software |
| Yindu Kitchen vs. Xiangpiaopiao Food Co | Yindu Kitchen vs. New Hope Dairy | Yindu Kitchen vs. Gan Yuan Foods | Yindu Kitchen vs. Jiahe Foods Industry |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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