Correlation Between Xinjiang Beixin and Shenzhen Zhongzhuang
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By analyzing existing cross correlation between Xinjiang Beixin RoadBridge and Shenzhen Zhongzhuang Construction, you can compare the effects of market volatilities on Xinjiang Beixin and Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Beixin and Shenzhen Zhongzhuang.
Diversification Opportunities for Xinjiang Beixin and Shenzhen Zhongzhuang
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xinjiang and Shenzhen is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Beixin RoadBridge and Shenzhen Zhongzhuang Construct in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Zhongzhuang has no effect on the direction of Xinjiang Beixin i.e., Xinjiang Beixin and Shenzhen Zhongzhuang go up and down completely randomly.
Pair Corralation between Xinjiang Beixin and Shenzhen Zhongzhuang
Assuming the 90 days trading horizon Xinjiang Beixin is expected to generate 2.85 times less return on investment than Shenzhen Zhongzhuang. In addition to that, Xinjiang Beixin is 1.1 times more volatile than Shenzhen Zhongzhuang Construction. It trades about 0.18 of its total potential returns per unit of risk. Shenzhen Zhongzhuang Construction is currently generating about 0.57 per unit of volatility. If you would invest 272.00 in Shenzhen Zhongzhuang Construction on September 5, 2024 and sell it today you would earn a total of 129.00 from holding Shenzhen Zhongzhuang Construction or generate 47.43% 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. Shenzhen Zhongzhuang Construct
Performance |
| Timeline |
| Xinjiang Beixin Road |
| Shenzhen Zhongzhuang |
Xinjiang Beixin and Shenzhen Zhongzhuang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Beixin and Shenzhen Zhongzhuang
The main advantage of trading using opposite Xinjiang Beixin and Shenzhen Zhongzhuang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Beixin position performs unexpectedly, Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang will offset losses from the drop in Shenzhen Zhongzhuang's long position.| Xinjiang Beixin vs. China Life Insurance | Xinjiang Beixin vs. Cinda Securities Co | Xinjiang Beixin vs. Piotech Inc A | Xinjiang Beixin vs. Dongxing Sec Co |
| Shenzhen Zhongzhuang vs. Central Plains Environment | Shenzhen Zhongzhuang vs. Bengang Steel Plates | Shenzhen Zhongzhuang vs. Ningbo Thermal Power | Shenzhen Zhongzhuang vs. Beijing SPC Environment |
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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