Correlation Between Xiandai Investment and Success Electronics
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By analyzing existing cross correlation between Xiandai Investment Co and Success Electronics, you can compare the effects of market volatilities on Xiandai Investment and Success Electronics 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 Success Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiandai Investment and Success Electronics.
Diversification Opportunities for Xiandai Investment and Success Electronics
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Xiandai and Success is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Xiandai Investment Co and Success Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Success Electronics 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 Success Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Success Electronics has no effect on the direction of Xiandai Investment i.e., Xiandai Investment and Success Electronics go up and down completely randomly.
Pair Corralation between Xiandai Investment and Success Electronics
Assuming the 90 days trading horizon Xiandai Investment Co is expected to generate 0.55 times more return on investment than Success Electronics. However, Xiandai Investment Co is 1.83 times less risky than Success Electronics. It trades about 0.04 of its potential returns per unit of risk. Success Electronics is currently generating about -0.01 per unit of risk. If you would invest 376.00 in Xiandai Investment Co on November 7, 2024 and sell it today you would earn a total of 46.00 from holding Xiandai Investment Co or generate 12.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiandai Investment Co vs. Success Electronics
Performance |
| Timeline |
| Xiandai Investment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Success Electronics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Xiandai Investment and Success Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiandai Investment and Success Electronics
The main advantage of trading using opposite Xiandai Investment and Success Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiandai Investment position performs unexpectedly, Success Electronics 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 Success Electronics will offset losses from the drop in Success Electronics' long position.The idea behind Xiandai Investment Co and Success Electronics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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