Correlation Between Xiangyang Automobile and Jizhong Energy
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Jizhong Energy Resources, you can compare the effects of market volatilities on Xiangyang Automobile and Jizhong Energy 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 Xiangyang Automobile with a short position of Jizhong Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Jizhong Energy.
Diversification Opportunities for Xiangyang Automobile and Jizhong Energy
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xiangyang and Jizhong is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Jizhong Energy Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jizhong Energy Resources and Xiangyang Automobile 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 Xiangyang Automobile Bearing are associated (or correlated) with Jizhong Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jizhong Energy Resources has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Jizhong Energy go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Jizhong Energy
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to generate 2.13 times more return on investment than Jizhong Energy. However, Xiangyang Automobile is 2.13 times more volatile than Jizhong Energy Resources. It trades about 0.03 of its potential returns per unit of risk. Jizhong Energy Resources is currently generating about 0.02 per unit of risk. If you would invest 533.00 in Xiangyang Automobile Bearing on August 31, 2024 and sell it today you would earn a total of 66.00 from holding Xiangyang Automobile Bearing or generate 12.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangyang Automobile Bearing vs. Jizhong Energy Resources
Performance |
| Timeline |
| Xiangyang Automobile |
| Jizhong Energy Resources |
Xiangyang Automobile and Jizhong Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Jizhong Energy
The main advantage of trading using opposite Xiangyang Automobile and Jizhong Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Jizhong Energy 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 Jizhong Energy will offset losses from the drop in Jizhong Energy's long position.| Xiangyang Automobile vs. China State Construction | Xiangyang Automobile vs. China Merchants Shekou | Xiangyang Automobile vs. Huafa Industrial Co | Xiangyang Automobile vs. China International Capital |
| Jizhong Energy vs. Allwin Telecommunication Co | Jizhong Energy vs. Xiangyang Automobile Bearing | Jizhong Energy vs. Union Semiconductor Co | Jizhong Energy vs. Shanghai Metersbonwe FashionAccessories |
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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