Correlation Between Xiangyang Automobile and Sichuan Yahua
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Sichuan Yahua Industrial, you can compare the effects of market volatilities on Xiangyang Automobile and Sichuan Yahua 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 Yahua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Sichuan Yahua.
Diversification Opportunities for Xiangyang Automobile and Sichuan Yahua
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xiangyang and Sichuan is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Sichuan Yahua Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Yahua Industrial 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 Yahua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Yahua Industrial has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Sichuan Yahua go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Sichuan Yahua
Assuming the 90 days trading horizon Xiangyang Automobile is expected to generate 1.86 times less return on investment than Sichuan Yahua. In addition to that, Xiangyang Automobile is 1.09 times more volatile than Sichuan Yahua Industrial. It trades about 0.11 of its total potential returns per unit of risk. Sichuan Yahua Industrial is currently generating about 0.23 per unit of volatility. If you would invest 875.00 in Sichuan Yahua Industrial on August 25, 2024 and sell it today you would earn a total of 339.00 from holding Sichuan Yahua Industrial or generate 38.74% 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. Sichuan Yahua Industrial
Performance |
| Timeline |
| Xiangyang Automobile |
| Sichuan Yahua Industrial |
Xiangyang Automobile and Sichuan Yahua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Sichuan Yahua
The main advantage of trading using opposite Xiangyang Automobile and Sichuan Yahua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Sichuan Yahua 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 Yahua will offset losses from the drop in Sichuan Yahua'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 |
| Sichuan Yahua vs. Changchun UP Optotech | Sichuan Yahua vs. Anhui Deli Household | Sichuan Yahua vs. Kangping Technology Co | Sichuan Yahua vs. CGN Nuclear Technology |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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