Correlation Between Xiangyang Automobile and Shanghai Rongtai
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Shanghai Rongtai Health, you can compare the effects of market volatilities on Xiangyang Automobile and Shanghai Rongtai 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 Shanghai Rongtai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Shanghai Rongtai.
Diversification Opportunities for Xiangyang Automobile and Shanghai Rongtai
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xiangyang and Shanghai is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Shanghai Rongtai Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Rongtai Health 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 Shanghai Rongtai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Rongtai Health has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Shanghai Rongtai go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Shanghai Rongtai
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to generate 1.18 times more return on investment than Shanghai Rongtai. However, Xiangyang Automobile is 1.18 times more volatile than Shanghai Rongtai Health. It trades about 0.02 of its potential returns per unit of risk. Shanghai Rongtai Health is currently generating about -0.04 per unit of risk. If you would invest 590.00 in Xiangyang Automobile Bearing on August 25, 2024 and sell it today you would lose (8.00) from holding Xiangyang Automobile Bearing or give up 1.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangyang Automobile Bearing vs. Shanghai Rongtai Health
Performance |
| Timeline |
| Xiangyang Automobile |
| Shanghai Rongtai Health |
Xiangyang Automobile and Shanghai Rongtai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Shanghai Rongtai
The main advantage of trading using opposite Xiangyang Automobile and Shanghai Rongtai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Shanghai Rongtai 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 Shanghai Rongtai will offset losses from the drop in Shanghai Rongtai'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 |
| Shanghai Rongtai vs. Hoshine Silicon Ind | Shanghai Rongtai vs. Agricultural Bank of | Shanghai Rongtai vs. Huatian Hotel Group | Shanghai Rongtai vs. Liuzhou Chemical Industry |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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