Correlation Between Xinjiang Beixin and China Railway
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By analyzing existing cross correlation between Xinjiang Beixin RoadBridge and China Railway Construction, you can compare the effects of market volatilities on Xinjiang Beixin and China Railway 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 Railway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Beixin and China Railway.
Diversification Opportunities for Xinjiang Beixin and China Railway
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xinjiang and China is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Beixin RoadBridge and China Railway Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Railway Constr 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 Railway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Railway Constr has no effect on the direction of Xinjiang Beixin i.e., Xinjiang Beixin and China Railway go up and down completely randomly.
Pair Corralation between Xinjiang Beixin and China Railway
Assuming the 90 days trading horizon Xinjiang Beixin RoadBridge is expected to generate 1.24 times more return on investment than China Railway. However, Xinjiang Beixin is 1.24 times more volatile than China Railway Construction. It trades about 0.12 of its potential returns per unit of risk. China Railway Construction is currently generating about 0.0 per unit of risk. If you would invest 362.00 in Xinjiang Beixin RoadBridge on August 28, 2024 and sell it today you would earn a total of 32.00 from holding Xinjiang Beixin RoadBridge or generate 8.84% 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 Railway Construction
Performance |
| Timeline |
| Xinjiang Beixin Road |
| China Railway Constr |
Xinjiang Beixin and China Railway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Beixin and China Railway
The main advantage of trading using opposite Xinjiang Beixin and China Railway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Beixin position performs unexpectedly, China Railway 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 Railway will offset losses from the drop in China Railway's long position.| Xinjiang Beixin vs. State Grid InformationCommunication | Xinjiang Beixin vs. Allwin Telecommunication Co | Xinjiang Beixin vs. Juewei Food Co | Xinjiang Beixin vs. Wuhan Yangtze Communication |
| China Railway vs. Iat Automobile Technology | China Railway vs. Zhejiang Qianjiang Motorcycle | China Railway vs. Allied Machinery Co | China Railway vs. Hongrun Construction Group |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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