Correlation Between Xinjiang Zhongtai and Shaanxi Beiyuan
Specify exactly 2 symbols:
By analyzing existing cross correlation between Xinjiang Zhongtai Chemical and Shaanxi Beiyuan Chemical, you can compare the effects of market volatilities on Xinjiang Zhongtai and Shaanxi Beiyuan 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 Shaanxi Beiyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Zhongtai and Shaanxi Beiyuan.
Diversification Opportunities for Xinjiang Zhongtai and Shaanxi Beiyuan
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xinjiang and Shaanxi is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Zhongtai Chemical and Shaanxi Beiyuan Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shaanxi Beiyuan Chemical 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 Shaanxi Beiyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shaanxi Beiyuan Chemical has no effect on the direction of Xinjiang Zhongtai i.e., Xinjiang Zhongtai and Shaanxi Beiyuan go up and down completely randomly.
Pair Corralation between Xinjiang Zhongtai and Shaanxi Beiyuan
Assuming the 90 days trading horizon Xinjiang Zhongtai Chemical is expected to generate 1.77 times more return on investment than Shaanxi Beiyuan. However, Xinjiang Zhongtai is 1.77 times more volatile than Shaanxi Beiyuan Chemical. It trades about 0.28 of its potential returns per unit of risk. Shaanxi Beiyuan Chemical is currently generating about 0.21 per unit of risk. If you would invest 406.00 in Xinjiang Zhongtai Chemical on September 5, 2024 and sell it today you would earn a total of 62.00 from holding Xinjiang Zhongtai Chemical or generate 15.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Xinjiang Zhongtai Chemical vs. Shaanxi Beiyuan Chemical
Performance |
| Timeline |
| Xinjiang Zhongtai |
| Shaanxi Beiyuan Chemical |
Xinjiang Zhongtai and Shaanxi Beiyuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Zhongtai and Shaanxi Beiyuan
The main advantage of trading using opposite Xinjiang Zhongtai and Shaanxi Beiyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Zhongtai position performs unexpectedly, Shaanxi Beiyuan 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 Shaanxi Beiyuan will offset losses from the drop in Shaanxi Beiyuan's long position.| Xinjiang Zhongtai vs. Zijin Mining Group | Xinjiang Zhongtai vs. Wanhua Chemical Group | Xinjiang Zhongtai vs. Baoshan Iron Steel | Xinjiang Zhongtai vs. Shandong Gold Mining |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |