Correlation Between Shaanxi Meineng and Hubei Xingfa
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By analyzing existing cross correlation between Shaanxi Meineng Clean and Hubei Xingfa Chemicals, you can compare the effects of market volatilities on Shaanxi Meineng and Hubei Xingfa 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 Shaanxi Meineng with a short position of Hubei Xingfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaanxi Meineng and Hubei Xingfa.
Diversification Opportunities for Shaanxi Meineng and Hubei Xingfa
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shaanxi and Hubei is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Shaanxi Meineng Clean and Hubei Xingfa Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Xingfa Chemicals and Shaanxi Meineng 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 Shaanxi Meineng Clean are associated (or correlated) with Hubei Xingfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Xingfa Chemicals has no effect on the direction of Shaanxi Meineng i.e., Shaanxi Meineng and Hubei Xingfa go up and down completely randomly.
Pair Corralation between Shaanxi Meineng and Hubei Xingfa
Assuming the 90 days trading horizon Shaanxi Meineng Clean is expected to under-perform the Hubei Xingfa. But the stock apears to be less risky and, when comparing its historical volatility, Shaanxi Meineng Clean is 1.01 times less risky than Hubei Xingfa. The stock trades about -0.06 of its potential returns per unit of risk. The Hubei Xingfa Chemicals is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 2,213 in Hubei Xingfa Chemicals on October 28, 2024 and sell it today you would lose (49.00) from holding Hubei Xingfa Chemicals or give up 2.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shaanxi Meineng Clean vs. Hubei Xingfa Chemicals
Performance |
| Timeline |
| Shaanxi Meineng Clean |
| Hubei Xingfa Chemicals |
Shaanxi Meineng and Hubei Xingfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shaanxi Meineng and Hubei Xingfa
The main advantage of trading using opposite Shaanxi Meineng and Hubei Xingfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaanxi Meineng position performs unexpectedly, Hubei Xingfa 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 Hubei Xingfa will offset losses from the drop in Hubei Xingfa's long position.| Shaanxi Meineng vs. Dhc Software Co | Shaanxi Meineng vs. Dareway Software Co | Shaanxi Meineng vs. Thunder Software Technology | Shaanxi Meineng vs. King Strong New Material |
| Hubei Xingfa vs. Maxvision Technology Corp | Hubei Xingfa vs. Holitech Technology Co | Hubei Xingfa vs. Uxi Unicomp Technology | Hubei Xingfa vs. Olympic Circuit 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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