Correlation Between Xiangyang Automobile and Dook Media
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Dook Media Group, you can compare the effects of market volatilities on Xiangyang Automobile and Dook Media 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 Dook Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Dook Media.
Diversification Opportunities for Xiangyang Automobile and Dook Media
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Xiangyang and Dook is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Dook Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dook Media Group 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 Dook Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dook Media Group has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Dook Media go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Dook Media
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to generate 1.56 times more return on investment than Dook Media. However, Xiangyang Automobile is 1.56 times more volatile than Dook Media Group. It trades about -0.18 of its potential returns per unit of risk. Dook Media Group is currently generating about -0.49 per unit of risk. If you would invest 721.00 in Xiangyang Automobile Bearing on October 14, 2024 and sell it today you would lose (143.00) from holding Xiangyang Automobile Bearing or give up 19.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangyang Automobile Bearing vs. Dook Media Group
Performance |
| Timeline |
| Xiangyang Automobile |
| Dook Media Group |
Xiangyang Automobile and Dook Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Dook Media
The main advantage of trading using opposite Xiangyang Automobile and Dook Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Dook Media 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 Dook Media will offset losses from the drop in Dook Media's long position.The idea behind Xiangyang Automobile Bearing and Dook Media Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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