Correlation Between Xiangyang Automobile and Eastern Communications
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Eastern Communications Co, you can compare the effects of market volatilities on Xiangyang Automobile and Eastern 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 Eastern Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Eastern Communications.
Diversification Opportunities for Xiangyang Automobile and Eastern Communications
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xiangyang and Eastern is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Eastern Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern 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 Eastern Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern Communications has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Eastern Communications go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Eastern Communications
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to under-perform the Eastern Communications. In addition to that, Xiangyang Automobile is 1.39 times more volatile than Eastern Communications Co. It trades about -0.01 of its total potential returns per unit of risk. Eastern Communications Co is currently generating about 0.05 per unit of volatility. If you would invest 42.00 in Eastern Communications Co on August 29, 2024 and sell it today you would earn a total of 1.00 from holding Eastern Communications Co or generate 2.38% 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. Eastern Communications Co
Performance |
| Timeline |
| Xiangyang Automobile |
| Eastern Communications |
Xiangyang Automobile and Eastern Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Eastern Communications
The main advantage of trading using opposite Xiangyang Automobile and Eastern Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Eastern 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 Eastern Communications will offset losses from the drop in Eastern Communications' long position.| Xiangyang Automobile vs. Loongson Technology Corp | Xiangyang Automobile vs. Chongqing Road Bridge | Xiangyang Automobile vs. Shenzhen Fortune Trend | Xiangyang Automobile vs. Wuhan Xianglong Power |
| Eastern Communications vs. Guangdong Jinma Entertainment | Eastern Communications vs. Huaibei Mining Holdings | Eastern Communications vs. Zijin Mining Group | Eastern Communications vs. Xinjiang Baodi Mining |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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