Correlation Between XinJiang GuoTong and Tonghua Grape
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By analyzing existing cross correlation between XinJiang GuoTong Pipeline and Tonghua Grape Wine, you can compare the effects of market volatilities on XinJiang GuoTong and Tonghua Grape 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 GuoTong with a short position of Tonghua Grape. Check out your portfolio center. Please also check ongoing floating volatility patterns of XinJiang GuoTong and Tonghua Grape.
Diversification Opportunities for XinJiang GuoTong and Tonghua Grape
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between XinJiang and Tonghua is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding XinJiang GuoTong Pipeline and Tonghua Grape Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tonghua Grape Wine and XinJiang GuoTong 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 GuoTong Pipeline are associated (or correlated) with Tonghua Grape. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tonghua Grape Wine has no effect on the direction of XinJiang GuoTong i.e., XinJiang GuoTong and Tonghua Grape go up and down completely randomly.
Pair Corralation between XinJiang GuoTong and Tonghua Grape
Assuming the 90 days trading horizon XinJiang GuoTong Pipeline is expected to generate 1.27 times more return on investment than Tonghua Grape. However, XinJiang GuoTong is 1.27 times more volatile than Tonghua Grape Wine. It trades about -0.01 of its potential returns per unit of risk. Tonghua Grape Wine is currently generating about -0.03 per unit of risk. If you would invest 1,154 in XinJiang GuoTong Pipeline on October 14, 2024 and sell it today you would lose (374.00) from holding XinJiang GuoTong Pipeline or give up 32.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
XinJiang GuoTong Pipeline vs. Tonghua Grape Wine
Performance |
| Timeline |
| XinJiang GuoTong Pipeline |
| Tonghua Grape Wine |
XinJiang GuoTong and Tonghua Grape Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XinJiang GuoTong and Tonghua Grape
The main advantage of trading using opposite XinJiang GuoTong and Tonghua Grape positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XinJiang GuoTong position performs unexpectedly, Tonghua Grape 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 Tonghua Grape will offset losses from the drop in Tonghua Grape's long position.| XinJiang GuoTong vs. Nanxing Furniture Machinery | XinJiang GuoTong vs. Digiwin Software Co | XinJiang GuoTong vs. Hunan Tyen Machinery | XinJiang GuoTong vs. Tianjin Ruixin Technology |
| Tonghua Grape vs. China Mobile Limited | Tonghua Grape vs. XinJiang GuoTong Pipeline | Tonghua Grape vs. Zhejiang Kingland Pipeline | Tonghua Grape vs. Shenzhen Topway Video |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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