Correlation Between Xinjiang Zhongtai and Nancal Energy
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By analyzing existing cross correlation between Xinjiang Zhongtai Chemical and Nancal Energy Saving Tech, you can compare the effects of market volatilities on Xinjiang Zhongtai and Nancal Energy 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 Nancal Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Zhongtai and Nancal Energy.
Diversification Opportunities for Xinjiang Zhongtai and Nancal Energy
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xinjiang and Nancal is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Zhongtai Chemical and Nancal Energy Saving Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nancal Energy Saving 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 Nancal Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nancal Energy Saving has no effect on the direction of Xinjiang Zhongtai i.e., Xinjiang Zhongtai and Nancal Energy go up and down completely randomly.
Pair Corralation between Xinjiang Zhongtai and Nancal Energy
Assuming the 90 days trading horizon Xinjiang Zhongtai is expected to generate 2.74 times less return on investment than Nancal Energy. But when comparing it to its historical volatility, Xinjiang Zhongtai Chemical is 2.38 times less risky than Nancal Energy. It trades about 0.24 of its potential returns per unit of risk. Nancal Energy Saving Tech is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 1,457 in Nancal Energy Saving Tech on September 3, 2024 and sell it today you would earn a total of 1,512 from holding Nancal Energy Saving Tech or generate 103.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Zhongtai Chemical vs. Nancal Energy Saving Tech
Performance |
| Timeline |
| Xinjiang Zhongtai |
| Nancal Energy Saving |
Xinjiang Zhongtai and Nancal Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Zhongtai and Nancal Energy
The main advantage of trading using opposite Xinjiang Zhongtai and Nancal Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Zhongtai position performs unexpectedly, Nancal Energy 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 Nancal Energy will offset losses from the drop in Nancal Energy's long position.| Xinjiang Zhongtai vs. Zijin Mining Group | Xinjiang Zhongtai vs. Baoshan Iron Steel | Xinjiang Zhongtai vs. Rongsheng Petrochemical Co | Xinjiang Zhongtai vs. Hoshine Silicon Ind |
| Nancal Energy vs. Jilin Chemical Fibre | Nancal Energy vs. Xinjiang Zhongtai Chemical | Nancal Energy vs. Shenyang Chemical Industry | Nancal Energy vs. Anhui Liuguo Chemical |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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