Correlation Between Xiamen Kehua and Dow Jones
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By analyzing existing cross correlation between Xiamen Kehua Hengsheng and Dow Jones Industrial, you can compare the effects of market volatilities on Xiamen Kehua and Dow Jones 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 Xiamen Kehua with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen Kehua and Dow Jones.
Diversification Opportunities for Xiamen Kehua and Dow Jones
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Xiamen and Dow is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen Kehua Hengsheng and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Xiamen Kehua 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 Xiamen Kehua Hengsheng are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Xiamen Kehua i.e., Xiamen Kehua and Dow Jones go up and down completely randomly.
Pair Corralation between Xiamen Kehua and Dow Jones
Assuming the 90 days trading horizon Xiamen Kehua Hengsheng is expected to generate 4.7 times more return on investment than Dow Jones. However, Xiamen Kehua is 4.7 times more volatile than Dow Jones Industrial. It trades about 0.05 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.07 per unit of risk. If you would invest 2,331 in Xiamen Kehua Hengsheng on October 18, 2024 and sell it today you would earn a total of 708.00 from holding Xiamen Kehua Hengsheng or generate 30.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.58% |
| Values | Daily Returns |
Xiamen Kehua Hengsheng vs. Dow Jones Industrial
Performance |
| Timeline |
Xiamen Kehua and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Xiamen Kehua Hengsheng
Pair trading matchups for Xiamen Kehua
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Xiamen Kehua and Dow Jones
The main advantage of trading using opposite Xiamen Kehua and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen Kehua position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Xiamen Kehua vs. China Petroleum Chemical | Xiamen Kehua vs. PetroChina Co Ltd | Xiamen Kehua vs. China State Construction | Xiamen Kehua vs. China Railway Group |
| Dow Jones vs. Neogen | Dow Jones vs. Alta Equipment Group | Dow Jones vs. Merit Medical Systems | Dow Jones vs. Summit Therapeutics PLC |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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