Correlation Between Xiangyang Automobile and Kunshan Guoli
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Kunshan Guoli Electronic, you can compare the effects of market volatilities on Xiangyang Automobile and Kunshan Guoli 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 Kunshan Guoli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Kunshan Guoli.
Diversification Opportunities for Xiangyang Automobile and Kunshan Guoli
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xiangyang and Kunshan is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Kunshan Guoli Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kunshan Guoli Electronic 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 Kunshan Guoli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kunshan Guoli Electronic has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Kunshan Guoli go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Kunshan Guoli
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to generate 0.96 times more return on investment than Kunshan Guoli. However, Xiangyang Automobile Bearing is 1.04 times less risky than Kunshan Guoli. It trades about 0.01 of its potential returns per unit of risk. Kunshan Guoli Electronic is currently generating about -0.01 per unit of risk. If you would invest 606.00 in Xiangyang Automobile Bearing on August 31, 2024 and sell it today you would lose (29.00) from holding Xiangyang Automobile Bearing or give up 4.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangyang Automobile Bearing vs. Kunshan Guoli Electronic
Performance |
| Timeline |
| Xiangyang Automobile |
| Kunshan Guoli Electronic |
Xiangyang Automobile and Kunshan Guoli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Kunshan Guoli
The main advantage of trading using opposite Xiangyang Automobile and Kunshan Guoli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Kunshan Guoli 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 Kunshan Guoli will offset losses from the drop in Kunshan Guoli's long position.| Xiangyang Automobile vs. China State Construction | Xiangyang Automobile vs. China Merchants Shekou | Xiangyang Automobile vs. Huafa Industrial Co | Xiangyang Automobile vs. China International Capital |
| Kunshan Guoli vs. Xingguang Agricultural Mach | Kunshan Guoli vs. Henzhen Zhaowei Machinery | Kunshan Guoli vs. Guizhou Chanhen Chemical | Kunshan Guoli vs. Sinomach General Machinery |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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