Correlation Between Xinjiang Beixin and China Merchants
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By analyzing existing cross correlation between Xinjiang Beixin RoadBridge and China Merchants Shekou, you can compare the effects of market volatilities on Xinjiang Beixin and China Merchants 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 Beixin with a short position of China Merchants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Beixin and China Merchants.
Diversification Opportunities for Xinjiang Beixin and China Merchants
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xinjiang and China is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Beixin RoadBridge and China Merchants Shekou in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Merchants Shekou and Xinjiang Beixin 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 Beixin RoadBridge are associated (or correlated) with China Merchants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Merchants Shekou has no effect on the direction of Xinjiang Beixin i.e., Xinjiang Beixin and China Merchants go up and down completely randomly.
Pair Corralation between Xinjiang Beixin and China Merchants
Assuming the 90 days trading horizon Xinjiang Beixin RoadBridge is expected to generate 0.81 times more return on investment than China Merchants. However, Xinjiang Beixin RoadBridge is 1.23 times less risky than China Merchants. It trades about 0.13 of its potential returns per unit of risk. China Merchants Shekou is currently generating about -0.08 per unit of risk. If you would invest 413.00 in Xinjiang Beixin RoadBridge on September 13, 2024 and sell it today you would earn a total of 20.00 from holding Xinjiang Beixin RoadBridge or generate 4.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Beixin RoadBridge vs. China Merchants Shekou
Performance |
| Timeline |
| Xinjiang Beixin Road |
| China Merchants Shekou |
Xinjiang Beixin and China Merchants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Beixin and China Merchants
The main advantage of trading using opposite Xinjiang Beixin and China Merchants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Beixin position performs unexpectedly, China Merchants 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 China Merchants will offset losses from the drop in China Merchants' long position.| Xinjiang Beixin vs. Ming Yang Smart | Xinjiang Beixin vs. 159681 | Xinjiang Beixin vs. 159005 | Xinjiang Beixin vs. Loctek Ergonomic Technology |
| China Merchants vs. Shandong Publishing Media | China Merchants vs. Offshore Oil Engineering | China Merchants vs. Xinjiang Beixin RoadBridge | China Merchants vs. Beijing Kaiwen Education |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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