Correlation Between Sichuan Fulin and Hang Xiao
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By analyzing existing cross correlation between Sichuan Fulin Transportation and Hang Xiao Steel, you can compare the effects of market volatilities on Sichuan Fulin and Hang Xiao 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 Sichuan Fulin with a short position of Hang Xiao. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Fulin and Hang Xiao.
Diversification Opportunities for Sichuan Fulin and Hang Xiao
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sichuan and Hang is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Fulin Transportation and Hang Xiao Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hang Xiao Steel and Sichuan Fulin 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 Sichuan Fulin Transportation are associated (or correlated) with Hang Xiao. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hang Xiao Steel has no effect on the direction of Sichuan Fulin i.e., Sichuan Fulin and Hang Xiao go up and down completely randomly.
Pair Corralation between Sichuan Fulin and Hang Xiao
Assuming the 90 days trading horizon Sichuan Fulin Transportation is expected to generate 1.04 times more return on investment than Hang Xiao. However, Sichuan Fulin is 1.04 times more volatile than Hang Xiao Steel. It trades about 0.34 of its potential returns per unit of risk. Hang Xiao Steel is currently generating about -0.02 per unit of risk. If you would invest 657.00 in Sichuan Fulin Transportation on September 12, 2024 and sell it today you would earn a total of 121.00 from holding Sichuan Fulin Transportation or generate 18.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Fulin Transportation vs. Hang Xiao Steel
Performance |
| Timeline |
| Sichuan Fulin Transp |
| Hang Xiao Steel |
Sichuan Fulin and Hang Xiao Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Fulin and Hang Xiao
The main advantage of trading using opposite Sichuan Fulin and Hang Xiao positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Fulin position performs unexpectedly, Hang Xiao 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 Hang Xiao will offset losses from the drop in Hang Xiao's long position.| Sichuan Fulin vs. Agricultural Bank of | Sichuan Fulin vs. Industrial and Commercial | Sichuan Fulin vs. Bank of China | Sichuan Fulin vs. PetroChina Co Ltd |
| Hang Xiao vs. Agricultural Bank of | Hang Xiao vs. Industrial and Commercial | Hang Xiao vs. Bank of China | Hang Xiao vs. PetroChina Co Ltd |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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