Correlation Between Maoming Petro and Xiangyang Automobile
Specify exactly 2 symbols:
By analyzing existing cross correlation between Maoming Petro Chemical Shihua and Xiangyang Automobile Bearing, you can compare the effects of market volatilities on Maoming Petro and Xiangyang Automobile 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 Maoming Petro with a short position of Xiangyang Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maoming Petro and Xiangyang Automobile.
Diversification Opportunities for Maoming Petro and Xiangyang Automobile
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Maoming and Xiangyang is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Maoming Petro Chemical Shihua and Xiangyang Automobile Bearing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiangyang Automobile and Maoming Petro 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 Maoming Petro Chemical Shihua are associated (or correlated) with Xiangyang Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiangyang Automobile has no effect on the direction of Maoming Petro i.e., Maoming Petro and Xiangyang Automobile go up and down completely randomly.
Pair Corralation between Maoming Petro and Xiangyang Automobile
Assuming the 90 days trading horizon Maoming Petro Chemical Shihua is expected to under-perform the Xiangyang Automobile. But the stock apears to be less risky and, when comparing its historical volatility, Maoming Petro Chemical Shihua is 2.16 times less risky than Xiangyang Automobile. The stock trades about -0.46 of its potential returns per unit of risk. The Xiangyang Automobile Bearing is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest 709.00 in Xiangyang Automobile Bearing on October 16, 2024 and sell it today you would lose (124.00) from holding Xiangyang Automobile Bearing or give up 17.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maoming Petro Chemical Shihua vs. Xiangyang Automobile Bearing
Performance |
| Timeline |
| Maoming Petro Chemical |
| Xiangyang Automobile |
Maoming Petro and Xiangyang Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maoming Petro and Xiangyang Automobile
The main advantage of trading using opposite Maoming Petro and Xiangyang Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maoming Petro position performs unexpectedly, Xiangyang Automobile 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 Xiangyang Automobile will offset losses from the drop in Xiangyang Automobile's long position.| Maoming Petro vs. Jonjee Hi tech Industrial | Maoming Petro vs. Oppein Home Group | Maoming Petro vs. Fujian Newland Computer | Maoming Petro vs. Nanjing Putian Telecommunications |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |