Correlation Between Xiangyang Automobile and Changchun
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Changchun UP Optotech, you can compare the effects of market volatilities on Xiangyang Automobile and Changchun 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 Changchun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Changchun.
Diversification Opportunities for Xiangyang Automobile and Changchun
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xiangyang and Changchun is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Changchun UP Optotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun UP Optotech 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 Changchun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun UP Optotech has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Changchun go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Changchun
Assuming the 90 days trading horizon Xiangyang Automobile is expected to generate 5.59 times less return on investment than Changchun. But when comparing it to its historical volatility, Xiangyang Automobile Bearing is 1.04 times less risky than Changchun. It trades about 0.01 of its potential returns per unit of risk. Changchun UP Optotech is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,537 in Changchun UP Optotech on August 25, 2024 and sell it today you would earn a total of 1,639 from holding Changchun UP Optotech or generate 64.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangyang Automobile Bearing vs. Changchun UP Optotech
Performance |
| Timeline |
| Xiangyang Automobile |
| Changchun UP Optotech |
Xiangyang Automobile and Changchun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Changchun
The main advantage of trading using opposite Xiangyang Automobile and Changchun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Changchun 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 Changchun will offset losses from the drop in Changchun's long position.| Xiangyang Automobile vs. Hainan Haiqi Transportation | Xiangyang Automobile vs. China Sports Industry | Xiangyang Automobile vs. Guangdong Brandmax Marketing | Xiangyang Automobile vs. Yindu Kitchen Equipment |
| Changchun vs. Huatian Hotel Group | Changchun vs. BTG Hotels Group | Changchun vs. Nexchip Semiconductor Corp | Changchun vs. Jinling Hotel Corp |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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