Correlation Between Xiangyang Automobile and Sunwave Communications
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Sunwave Communications Co, you can compare the effects of market volatilities on Xiangyang Automobile and Sunwave Communications 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 Sunwave Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Sunwave Communications.
Diversification Opportunities for Xiangyang Automobile and Sunwave Communications
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xiangyang and Sunwave is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Sunwave Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunwave Communications 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 Sunwave Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunwave Communications has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Sunwave Communications go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Sunwave Communications
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to under-perform the Sunwave Communications. But the stock apears to be less risky and, when comparing its historical volatility, Xiangyang Automobile Bearing is 1.19 times less risky than Sunwave Communications. The stock trades about -0.01 of its potential returns per unit of risk. The Sunwave Communications Co is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 568.00 in Sunwave Communications Co on August 28, 2024 and sell it today you would earn a total of 109.00 from holding Sunwave Communications Co or generate 19.19% 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. Sunwave Communications Co
Performance |
| Timeline |
| Xiangyang Automobile |
| Sunwave Communications |
Xiangyang Automobile and Sunwave Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Sunwave Communications
The main advantage of trading using opposite Xiangyang Automobile and Sunwave Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Sunwave Communications 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 Sunwave Communications will offset losses from the drop in Sunwave Communications' long position.| Xiangyang Automobile vs. Loongson Technology Corp | Xiangyang Automobile vs. Chongqing Road Bridge | Xiangyang Automobile vs. Shenzhen Fortune Trend | Xiangyang Automobile vs. Wuhan Xianglong Power |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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