Correlation Between Chengdu Xingrong and Suzhou Weizhixiang
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By analyzing existing cross correlation between Chengdu Xingrong Investment and Suzhou Weizhixiang Food, you can compare the effects of market volatilities on Chengdu Xingrong and Suzhou Weizhixiang 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 Suzhou Weizhixiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Xingrong and Suzhou Weizhixiang.
Diversification Opportunities for Chengdu Xingrong and Suzhou Weizhixiang
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chengdu and Suzhou is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Xingrong Investment and Suzhou Weizhixiang Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzhou Weizhixiang Food 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 Suzhou Weizhixiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzhou Weizhixiang Food has no effect on the direction of Chengdu Xingrong i.e., Chengdu Xingrong and Suzhou Weizhixiang go up and down completely randomly.
Pair Corralation between Chengdu Xingrong and Suzhou Weizhixiang
Assuming the 90 days trading horizon Chengdu Xingrong Investment is expected to generate 0.74 times more return on investment than Suzhou Weizhixiang. However, Chengdu Xingrong Investment is 1.35 times less risky than Suzhou Weizhixiang. It trades about 0.06 of its potential returns per unit of risk. Suzhou Weizhixiang Food is currently generating about -0.04 per unit of risk. If you would invest 546.00 in Chengdu Xingrong Investment on September 4, 2024 and sell it today you would earn a total of 168.00 from holding Chengdu Xingrong Investment or generate 30.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Xingrong Investment vs. Suzhou Weizhixiang Food
Performance |
| Timeline |
| Chengdu Xingrong Inv |
| Suzhou Weizhixiang Food |
Chengdu Xingrong and Suzhou Weizhixiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Xingrong and Suzhou Weizhixiang
The main advantage of trading using opposite Chengdu Xingrong and Suzhou Weizhixiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Xingrong position performs unexpectedly, Suzhou Weizhixiang 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 Suzhou Weizhixiang will offset losses from the drop in Suzhou Weizhixiang's long position.| Chengdu Xingrong vs. Wuxi Chemical Equipment | Chengdu Xingrong vs. Guangzhou Haige Communications | Chengdu Xingrong vs. CICT Mobile Communication | Chengdu Xingrong vs. Shenyang Chemical Industry |
| Suzhou Weizhixiang vs. Poly Real Estate | Suzhou Weizhixiang vs. China Vanke Co | Suzhou Weizhixiang vs. China Merchants Shekou | Suzhou Weizhixiang vs. Huafa Industrial 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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