Correlation Between Xiandai Investment and Nanhua Bio
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By analyzing existing cross correlation between Xiandai Investment Co and Nanhua Bio Medicine, you can compare the effects of market volatilities on Xiandai Investment and Nanhua Bio 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 Xiandai Investment with a short position of Nanhua Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiandai Investment and Nanhua Bio.
Diversification Opportunities for Xiandai Investment and Nanhua Bio
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Xiandai and Nanhua is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Xiandai Investment Co and Nanhua Bio Medicine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanhua Bio Medicine and Xiandai Investment 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 Xiandai Investment Co are associated (or correlated) with Nanhua Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanhua Bio Medicine has no effect on the direction of Xiandai Investment i.e., Xiandai Investment and Nanhua Bio go up and down completely randomly.
Pair Corralation between Xiandai Investment and Nanhua Bio
Assuming the 90 days trading horizon Xiandai Investment Co is expected to generate 0.65 times more return on investment than Nanhua Bio. However, Xiandai Investment Co is 1.55 times less risky than Nanhua Bio. It trades about -0.32 of its potential returns per unit of risk. Nanhua Bio Medicine is currently generating about -0.56 per unit of risk. If you would invest 471.00 in Xiandai Investment Co on October 9, 2024 and sell it today you would lose (51.00) from holding Xiandai Investment Co or give up 10.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiandai Investment Co vs. Nanhua Bio Medicine
Performance |
| Timeline |
| Xiandai Investment |
| Nanhua Bio Medicine |
Xiandai Investment and Nanhua Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiandai Investment and Nanhua Bio
The main advantage of trading using opposite Xiandai Investment and Nanhua Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiandai Investment position performs unexpectedly, Nanhua Bio 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 Nanhua Bio will offset losses from the drop in Nanhua Bio's long position.| Xiandai Investment vs. Industrial and Commercial | Xiandai Investment vs. Agricultural Bank of | Xiandai Investment vs. China Construction Bank | Xiandai Investment vs. Bank of China |
| Nanhua Bio vs. BeiGene | Nanhua Bio vs. Kweichow Moutai Co | Nanhua Bio vs. Beijing Roborock Technology | Nanhua Bio vs. G bits Network Technology |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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