Correlation Between Xiandai Investment and Qingdao Foods
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By analyzing existing cross correlation between Xiandai Investment Co and Qingdao Foods Co, you can compare the effects of market volatilities on Xiandai Investment and Qingdao Foods 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 Qingdao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiandai Investment and Qingdao Foods.
Diversification Opportunities for Xiandai Investment and Qingdao Foods
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xiandai and Qingdao is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Xiandai Investment Co and Qingdao Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingdao Foods 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 Qingdao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingdao Foods has no effect on the direction of Xiandai Investment i.e., Xiandai Investment and Qingdao Foods go up and down completely randomly.
Pair Corralation between Xiandai Investment and Qingdao Foods
Assuming the 90 days trading horizon Xiandai Investment Co is expected to generate 0.66 times more return on investment than Qingdao Foods. However, Xiandai Investment Co is 1.51 times less risky than Qingdao Foods. It trades about 0.01 of its potential returns per unit of risk. Qingdao Foods Co is currently generating about 0.0 per unit of risk. If you would invest 402.00 in Xiandai Investment Co on October 16, 2024 and sell it today you would earn a total of 18.00 from holding Xiandai Investment Co or generate 4.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiandai Investment Co vs. Qingdao Foods Co
Performance |
| Timeline |
| Xiandai Investment |
| Qingdao Foods |
Xiandai Investment and Qingdao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiandai Investment and Qingdao Foods
The main advantage of trading using opposite Xiandai Investment and Qingdao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiandai Investment position performs unexpectedly, Qingdao Foods 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 Qingdao Foods will offset losses from the drop in Qingdao Foods' long position.| Xiandai Investment vs. Sichuan Fulin Transportation | Xiandai Investment vs. Shuhua Sports Co | Xiandai Investment vs. Hubeiyichang Transportation Group | Xiandai Investment vs. Hengdian Entertainment Co |
| Qingdao Foods vs. Great Sun Foods Co | Qingdao Foods vs. Jiangsu Yueda Investment | Qingdao Foods vs. Cansino Biologics | Qingdao Foods vs. Xiandai Investment Co |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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