Correlation Between Shenyang Huitian and Xinjiang Baodi
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By analyzing existing cross correlation between Shenyang Huitian Thermal and Xinjiang Baodi Mining, you can compare the effects of market volatilities on Shenyang Huitian and Xinjiang Baodi 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 Shenyang Huitian with a short position of Xinjiang Baodi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenyang Huitian and Xinjiang Baodi.
Diversification Opportunities for Shenyang Huitian and Xinjiang Baodi
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shenyang and Xinjiang is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Shenyang Huitian Thermal and Xinjiang Baodi Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Baodi Mining and Shenyang Huitian 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 Shenyang Huitian Thermal are associated (or correlated) with Xinjiang Baodi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Baodi Mining has no effect on the direction of Shenyang Huitian i.e., Shenyang Huitian and Xinjiang Baodi go up and down completely randomly.
Pair Corralation between Shenyang Huitian and Xinjiang Baodi
Assuming the 90 days trading horizon Shenyang Huitian Thermal is expected to generate 1.29 times more return on investment than Xinjiang Baodi. However, Shenyang Huitian is 1.29 times more volatile than Xinjiang Baodi Mining. It trades about 0.14 of its potential returns per unit of risk. Xinjiang Baodi Mining is currently generating about 0.12 per unit of risk. If you would invest 291.00 in Shenyang Huitian Thermal on August 30, 2024 and sell it today you would earn a total of 82.00 from holding Shenyang Huitian Thermal or generate 28.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenyang Huitian Thermal vs. Xinjiang Baodi Mining
Performance |
| Timeline |
| Shenyang Huitian Thermal |
| Xinjiang Baodi Mining |
Shenyang Huitian and Xinjiang Baodi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenyang Huitian and Xinjiang Baodi
The main advantage of trading using opposite Shenyang Huitian and Xinjiang Baodi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenyang Huitian position performs unexpectedly, Xinjiang Baodi 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 Xinjiang Baodi will offset losses from the drop in Xinjiang Baodi's long position.| Shenyang Huitian vs. Industrial and Commercial | Shenyang Huitian vs. Kweichow Moutai Co | Shenyang Huitian vs. Agricultural Bank of | Shenyang Huitian vs. China Mobile Limited |
| Xinjiang Baodi vs. Shanghai Jinfeng Wine | Xinjiang Baodi vs. Hainan Mining Co | Xinjiang Baodi vs. Cicc Fund Management | Xinjiang Baodi vs. Sanbo Hospital Management |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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