Correlation Between Shenyang Chemical and Xinjiang Communications
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By analyzing existing cross correlation between Shenyang Chemical Industry and Xinjiang Communications Construction, you can compare the effects of market volatilities on Shenyang Chemical and Xinjiang 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 Shenyang Chemical with a short position of Xinjiang Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenyang Chemical and Xinjiang Communications.
Diversification Opportunities for Shenyang Chemical and Xinjiang Communications
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenyang and Xinjiang is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Shenyang Chemical Industry and Xinjiang Communications Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Communications and Shenyang Chemical 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 Chemical Industry are associated (or correlated) with Xinjiang Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Communications has no effect on the direction of Shenyang Chemical i.e., Shenyang Chemical and Xinjiang Communications go up and down completely randomly.
Pair Corralation between Shenyang Chemical and Xinjiang Communications
Assuming the 90 days trading horizon Shenyang Chemical Industry is expected to under-perform the Xinjiang Communications. But the stock apears to be less risky and, when comparing its historical volatility, Shenyang Chemical Industry is 1.15 times less risky than Xinjiang Communications. The stock trades about -0.02 of its potential returns per unit of risk. The Xinjiang Communications Construction is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,336 in Xinjiang Communications Construction on November 2, 2024 and sell it today you would lose (263.00) from holding Xinjiang Communications Construction or give up 19.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenyang Chemical Industry vs. Xinjiang Communications Constr
Performance |
| Timeline |
| Shenyang Chemical |
| Xinjiang Communications |
Shenyang Chemical and Xinjiang Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenyang Chemical and Xinjiang Communications
The main advantage of trading using opposite Shenyang Chemical and Xinjiang Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenyang Chemical position performs unexpectedly, Xinjiang 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 Xinjiang Communications will offset losses from the drop in Xinjiang Communications' long position.| Shenyang Chemical vs. Fibocom Wireless | Shenyang Chemical vs. Runjian Communication Co | Shenyang Chemical vs. Guangdong Jinma Entertainment | Shenyang Chemical vs. Fiberhome Telecommunication Technologies |
| Xinjiang Communications vs. AVIC Fund Management | Xinjiang Communications vs. Chenzhou Jingui Silver | Xinjiang Communications vs. Air China Ltd | Xinjiang Communications vs. Innovative Medical 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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