Correlation Between Xiangyang Automobile and Sichuan Tianqi
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Sichuan Tianqi Lithium, you can compare the effects of market volatilities on Xiangyang Automobile and Sichuan Tianqi 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 Sichuan Tianqi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Sichuan Tianqi.
Diversification Opportunities for Xiangyang Automobile and Sichuan Tianqi
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xiangyang and Sichuan is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Sichuan Tianqi Lithium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Tianqi Lithium 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 Sichuan Tianqi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Tianqi Lithium has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Sichuan Tianqi go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Sichuan Tianqi
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to generate 1.08 times more return on investment than Sichuan Tianqi. However, Xiangyang Automobile is 1.08 times more volatile than Sichuan Tianqi Lithium. It trades about 0.2 of its potential returns per unit of risk. Sichuan Tianqi Lithium is currently generating about -0.16 per unit of risk. If you would invest 636.00 in Xiangyang Automobile Bearing on September 14, 2024 and sell it today you would earn a total of 97.00 from holding Xiangyang Automobile Bearing or generate 15.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangyang Automobile Bearing vs. Sichuan Tianqi Lithium
Performance |
| Timeline |
| Xiangyang Automobile |
| Sichuan Tianqi Lithium |
Xiangyang Automobile and Sichuan Tianqi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Sichuan Tianqi
The main advantage of trading using opposite Xiangyang Automobile and Sichuan Tianqi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Sichuan Tianqi 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 Sichuan Tianqi will offset losses from the drop in Sichuan Tianqi's long position.| Xiangyang Automobile vs. BeiGene | Xiangyang Automobile vs. Kweichow Moutai Co | Xiangyang Automobile vs. Beijing Roborock Technology | Xiangyang Automobile vs. G bits Network Technology |
| Sichuan Tianqi vs. Keda Clean Energy | Sichuan Tianqi vs. Servyou Software Group | Sichuan Tianqi vs. Zoje Resources Investment | Sichuan Tianqi vs. China Asset Management |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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