Correlation Between Henan Shuanghui and Xiandai Investment
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By analyzing existing cross correlation between Henan Shuanghui Investment and Xiandai Investment Co, you can compare the effects of market volatilities on Henan Shuanghui and Xiandai Investment 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 Henan Shuanghui with a short position of Xiandai Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Henan Shuanghui and Xiandai Investment.
Diversification Opportunities for Henan Shuanghui and Xiandai Investment
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Henan and Xiandai is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Henan Shuanghui Investment and Xiandai Investment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiandai Investment and Henan Shuanghui 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 Henan Shuanghui Investment are associated (or correlated) with Xiandai Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiandai Investment has no effect on the direction of Henan Shuanghui i.e., Henan Shuanghui and Xiandai Investment go up and down completely randomly.
Pair Corralation between Henan Shuanghui and Xiandai Investment
Assuming the 90 days trading horizon Henan Shuanghui Investment is expected to generate 1.32 times more return on investment than Xiandai Investment. However, Henan Shuanghui is 1.32 times more volatile than Xiandai Investment Co. It trades about 0.07 of its potential returns per unit of risk. Xiandai Investment Co is currently generating about 0.04 per unit of risk. If you would invest 2,596 in Henan Shuanghui Investment on November 4, 2024 and sell it today you would earn a total of 40.00 from holding Henan Shuanghui Investment or generate 1.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Henan Shuanghui Investment vs. Xiandai Investment Co
Performance |
| Timeline |
| Henan Shuanghui Inve |
| Xiandai Investment |
Henan Shuanghui and Xiandai Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Henan Shuanghui and Xiandai Investment
The main advantage of trading using opposite Henan Shuanghui and Xiandai Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Henan Shuanghui position performs unexpectedly, Xiandai Investment 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 Xiandai Investment will offset losses from the drop in Xiandai Investment's long position.| Henan Shuanghui vs. Shenzhen Noposion Agrochemicals | Henan Shuanghui vs. Ningxia Younglight Chemicals | Henan Shuanghui vs. Ningbo Kangqiang Electronics | Henan Shuanghui vs. Techshine Electronics Co |
| Xiandai Investment vs. BTG Hotels Group | Xiandai Investment vs. Guangzhou Dongfang Hotel | Xiandai Investment vs. Guangxi Wuzhou Communications | Xiandai Investment vs. Jinling Hotel Corp |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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