Correlation Between Xinjiang Zhongtai and Beijing Sanyuan
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By analyzing existing cross correlation between Xinjiang Zhongtai Chemical and Beijing Sanyuan Foods, you can compare the effects of market volatilities on Xinjiang Zhongtai and Beijing Sanyuan 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 Xinjiang Zhongtai with a short position of Beijing Sanyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Zhongtai and Beijing Sanyuan.
Diversification Opportunities for Xinjiang Zhongtai and Beijing Sanyuan
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xinjiang and Beijing is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Zhongtai Chemical and Beijing Sanyuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Sanyuan Foods and Xinjiang Zhongtai 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 Xinjiang Zhongtai Chemical are associated (or correlated) with Beijing Sanyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Sanyuan Foods has no effect on the direction of Xinjiang Zhongtai i.e., Xinjiang Zhongtai and Beijing Sanyuan go up and down completely randomly.
Pair Corralation between Xinjiang Zhongtai and Beijing Sanyuan
Assuming the 90 days trading horizon Xinjiang Zhongtai Chemical is expected to under-perform the Beijing Sanyuan. In addition to that, Xinjiang Zhongtai is 1.37 times more volatile than Beijing Sanyuan Foods. It trades about -0.03 of its total potential returns per unit of risk. Beijing Sanyuan Foods is currently generating about 0.0 per unit of volatility. If you would invest 518.00 in Beijing Sanyuan Foods on September 13, 2024 and sell it today you would lose (34.00) from holding Beijing Sanyuan Foods or give up 6.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
Xinjiang Zhongtai Chemical vs. Beijing Sanyuan Foods
Performance |
| Timeline |
| Xinjiang Zhongtai |
| Beijing Sanyuan Foods |
Xinjiang Zhongtai and Beijing Sanyuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Zhongtai and Beijing Sanyuan
The main advantage of trading using opposite Xinjiang Zhongtai and Beijing Sanyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Zhongtai position performs unexpectedly, Beijing Sanyuan 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 Beijing Sanyuan will offset losses from the drop in Beijing Sanyuan's long position.| Xinjiang Zhongtai vs. Heilongjiang Transport Development | Xinjiang Zhongtai vs. Harbin Hatou Investment | Xinjiang Zhongtai vs. Kunwu Jiuding Investment | Xinjiang Zhongtai vs. Xinjiang Beixin RoadBridge |
| Beijing Sanyuan vs. Nanjing Putian Telecommunications | Beijing Sanyuan vs. Tianjin Realty Development | Beijing Sanyuan vs. Kangyue Technology Co | Beijing Sanyuan vs. Shenzhen Hifuture Electric |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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