Correlation Between Hunan Mendale and WuXi Xinje
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By analyzing existing cross correlation between Hunan Mendale Hometextile and WuXi Xinje Electric, you can compare the effects of market volatilities on Hunan Mendale and WuXi Xinje 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 Hunan Mendale with a short position of WuXi Xinje. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunan Mendale and WuXi Xinje.
Diversification Opportunities for Hunan Mendale and WuXi Xinje
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hunan and WuXi is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Hunan Mendale Hometextile and WuXi Xinje Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WuXi Xinje Electric and Hunan Mendale 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 Hunan Mendale Hometextile are associated (or correlated) with WuXi Xinje. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WuXi Xinje Electric has no effect on the direction of Hunan Mendale i.e., Hunan Mendale and WuXi Xinje go up and down completely randomly.
Pair Corralation between Hunan Mendale and WuXi Xinje
Assuming the 90 days trading horizon Hunan Mendale Hometextile is expected to generate 2.27 times more return on investment than WuXi Xinje. However, Hunan Mendale is 2.27 times more volatile than WuXi Xinje Electric. It trades about 0.05 of its potential returns per unit of risk. WuXi Xinje Electric is currently generating about 0.08 per unit of risk. If you would invest 328.00 in Hunan Mendale Hometextile on October 15, 2024 and sell it today you would earn a total of 10.00 from holding Hunan Mendale Hometextile or generate 3.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hunan Mendale Hometextile vs. WuXi Xinje Electric
Performance |
| Timeline |
| Hunan Mendale Hometextile |
| WuXi Xinje Electric |
Hunan Mendale and WuXi Xinje Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hunan Mendale and WuXi Xinje
The main advantage of trading using opposite Hunan Mendale and WuXi Xinje positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunan Mendale position performs unexpectedly, WuXi Xinje 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 WuXi Xinje will offset losses from the drop in WuXi Xinje's long position.| Hunan Mendale vs. China Mobile Limited | Hunan Mendale vs. Marssenger Kitchenware Co | Hunan Mendale vs. Fibocom Wireless | Hunan Mendale vs. Fiberhome Telecommunication Technologies |
| WuXi Xinje vs. Hunan Mendale Hometextile | WuXi Xinje vs. Jinlong Machinery Electronic | WuXi Xinje vs. Qumei Furniture Group | WuXi Xinje vs. Aurora Optoelectronics Co |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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