Correlation Between Weichai Heavy and Qijing Machinery
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By analyzing existing cross correlation between Weichai Heavy Machinery and Qijing Machinery, you can compare the effects of market volatilities on Weichai Heavy and Qijing Machinery 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 Weichai Heavy with a short position of Qijing Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weichai Heavy and Qijing Machinery.
Diversification Opportunities for Weichai Heavy and Qijing Machinery
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Weichai and Qijing is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Weichai Heavy Machinery and Qijing Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qijing Machinery and Weichai Heavy 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 Weichai Heavy Machinery are associated (or correlated) with Qijing Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qijing Machinery has no effect on the direction of Weichai Heavy i.e., Weichai Heavy and Qijing Machinery go up and down completely randomly.
Pair Corralation between Weichai Heavy and Qijing Machinery
Assuming the 90 days trading horizon Weichai Heavy Machinery is expected to generate 1.36 times more return on investment than Qijing Machinery. However, Weichai Heavy is 1.36 times more volatile than Qijing Machinery. It trades about 0.13 of its potential returns per unit of risk. Qijing Machinery is currently generating about 0.02 per unit of risk. If you would invest 1,050 in Weichai Heavy Machinery on August 25, 2024 and sell it today you would earn a total of 134.00 from holding Weichai Heavy Machinery or generate 12.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weichai Heavy Machinery vs. Qijing Machinery
Performance |
| Timeline |
| Weichai Heavy Machinery |
| Qijing Machinery |
Weichai Heavy and Qijing Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weichai Heavy and Qijing Machinery
The main advantage of trading using opposite Weichai Heavy and Qijing Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weichai Heavy position performs unexpectedly, Qijing Machinery 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 Qijing Machinery will offset losses from the drop in Qijing Machinery's long position.| Weichai Heavy vs. Tongyu Communication | Weichai Heavy vs. FSPG Hi Tech Co | Weichai Heavy vs. HaiXin Foods Co | Weichai Heavy vs. Suzhou Weizhixiang Food |
| Qijing Machinery vs. Lootom Telcovideo Network | Qijing Machinery vs. Shenzhen Topway Video | Qijing Machinery vs. Nuode Investment Co | Qijing Machinery vs. Hubei Geoway Investment |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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