Correlation Between Xiwang Foodstuffs and Wanhua Chemical
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By analyzing existing cross correlation between Xiwang Foodstuffs Co and Wanhua Chemical Group, you can compare the effects of market volatilities on Xiwang Foodstuffs and Wanhua Chemical 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 Xiwang Foodstuffs with a short position of Wanhua Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiwang Foodstuffs and Wanhua Chemical.
Diversification Opportunities for Xiwang Foodstuffs and Wanhua Chemical
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xiwang and Wanhua is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Xiwang Foodstuffs Co and Wanhua Chemical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wanhua Chemical Group and Xiwang Foodstuffs 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 Xiwang Foodstuffs Co are associated (or correlated) with Wanhua Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wanhua Chemical Group has no effect on the direction of Xiwang Foodstuffs i.e., Xiwang Foodstuffs and Wanhua Chemical go up and down completely randomly.
Pair Corralation between Xiwang Foodstuffs and Wanhua Chemical
Assuming the 90 days trading horizon Xiwang Foodstuffs Co is expected to under-perform the Wanhua Chemical. In addition to that, Xiwang Foodstuffs is 1.96 times more volatile than Wanhua Chemical Group. It trades about -0.02 of its total potential returns per unit of risk. Wanhua Chemical Group is currently generating about -0.01 per unit of volatility. If you would invest 7,516 in Wanhua Chemical Group on October 30, 2024 and sell it today you would lose (663.00) from holding Wanhua Chemical Group or give up 8.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiwang Foodstuffs Co vs. Wanhua Chemical Group
Performance |
| Timeline |
| Xiwang Foodstuffs |
| Wanhua Chemical Group |
Xiwang Foodstuffs and Wanhua Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiwang Foodstuffs and Wanhua Chemical
The main advantage of trading using opposite Xiwang Foodstuffs and Wanhua Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiwang Foodstuffs position performs unexpectedly, Wanhua Chemical 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 Wanhua Chemical will offset losses from the drop in Wanhua Chemical's long position.| Xiwang Foodstuffs vs. Kweichow Moutai Co | Xiwang Foodstuffs vs. Contemporary Amperex Technology | Xiwang Foodstuffs vs. G bits Network Technology | Xiwang Foodstuffs vs. Beijing Roborock Technology |
| Wanhua Chemical vs. Citic Guoan Wine | Wanhua Chemical vs. Chengtun Mining Group | Wanhua Chemical vs. Pengxin International Mining | Wanhua Chemical vs. Tianjin Silvery Dragon |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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