Correlation Between Sinosteel Engineering and Xiamen Jihong
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By analyzing existing cross correlation between Sinosteel Engineering and and Xiamen Jihong Package, you can compare the effects of market volatilities on Sinosteel Engineering and Xiamen Jihong 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 Sinosteel Engineering with a short position of Xiamen Jihong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinosteel Engineering and Xiamen Jihong.
Diversification Opportunities for Sinosteel Engineering and Xiamen Jihong
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sinosteel and Xiamen is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Sinosteel Engineering and and Xiamen Jihong Package in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Jihong Package and Sinosteel Engineering 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 Sinosteel Engineering and are associated (or correlated) with Xiamen Jihong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Jihong Package has no effect on the direction of Sinosteel Engineering i.e., Sinosteel Engineering and Xiamen Jihong go up and down completely randomly.
Pair Corralation between Sinosteel Engineering and Xiamen Jihong
Assuming the 90 days trading horizon Sinosteel Engineering is expected to generate 3.5 times less return on investment than Xiamen Jihong. But when comparing it to its historical volatility, Sinosteel Engineering and is 1.53 times less risky than Xiamen Jihong. It trades about 0.06 of its potential returns per unit of risk. Xiamen Jihong Package is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,446 in Xiamen Jihong Package on September 6, 2024 and sell it today you would earn a total of 141.00 from holding Xiamen Jihong Package or generate 9.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinosteel Engineering and vs. Xiamen Jihong Package
Performance |
| Timeline |
| Sinosteel Engineering and |
| Xiamen Jihong Package |
Sinosteel Engineering and Xiamen Jihong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinosteel Engineering and Xiamen Jihong
The main advantage of trading using opposite Sinosteel Engineering and Xiamen Jihong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinosteel Engineering position performs unexpectedly, Xiamen Jihong 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 Xiamen Jihong will offset losses from the drop in Xiamen Jihong's long position.| Sinosteel Engineering vs. Kweichow Moutai Co | Sinosteel Engineering vs. Jiangsu Pacific Quartz | Sinosteel Engineering vs. Contemporary Amperex Technology | Sinosteel Engineering vs. Wuliangye Yibin Co |
| Xiamen Jihong vs. Zijin Mining Group | Xiamen Jihong vs. Wanhua Chemical Group | Xiamen Jihong vs. Baoshan Iron Steel | Xiamen Jihong vs. Rongsheng Petrochemical 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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