Correlation Between Xiangyang Automobile and Wintao Communications
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Wintao Communications Co, you can compare the effects of market volatilities on Xiangyang Automobile and Wintao 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 Wintao Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Wintao Communications.
Diversification Opportunities for Xiangyang Automobile and Wintao Communications
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xiangyang and Wintao is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Wintao Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wintao 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 Wintao Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wintao Communications has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Wintao Communications go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Wintao Communications
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to generate 1.51 times more return on investment than Wintao Communications. However, Xiangyang Automobile is 1.51 times more volatile than Wintao Communications Co. It trades about 0.07 of its potential returns per unit of risk. Wintao Communications Co is currently generating about -0.04 per unit of risk. If you would invest 576.00 in Xiangyang Automobile Bearing on October 17, 2024 and sell it today you would earn a total of 49.00 from holding Xiangyang Automobile Bearing or generate 8.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangyang Automobile Bearing vs. Wintao Communications Co
Performance |
| Timeline |
| Xiangyang Automobile |
| Wintao Communications |
Xiangyang Automobile and Wintao Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Wintao Communications
The main advantage of trading using opposite Xiangyang Automobile and Wintao Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Wintao 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 Wintao Communications will offset losses from the drop in Wintao Communications' long position.The idea behind Xiangyang Automobile Bearing and Wintao Communications Co 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.
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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