Correlation Between Shenzhen Aisidi and Xiamen Bank
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By analyzing existing cross correlation between Shenzhen Aisidi Co and Xiamen Bank Co, you can compare the effects of market volatilities on Shenzhen Aisidi and Xiamen Bank 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 Shenzhen Aisidi with a short position of Xiamen Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Aisidi and Xiamen Bank.
Diversification Opportunities for Shenzhen Aisidi and Xiamen Bank
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenzhen and Xiamen is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Aisidi Co and Xiamen Bank Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Bank and Shenzhen Aisidi 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 Shenzhen Aisidi Co are associated (or correlated) with Xiamen Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Bank has no effect on the direction of Shenzhen Aisidi i.e., Shenzhen Aisidi and Xiamen Bank go up and down completely randomly.
Pair Corralation between Shenzhen Aisidi and Xiamen Bank
Assuming the 90 days trading horizon Shenzhen Aisidi Co is expected to generate 1.99 times more return on investment than Xiamen Bank. However, Shenzhen Aisidi is 1.99 times more volatile than Xiamen Bank Co. It trades about 0.06 of its potential returns per unit of risk. Xiamen Bank Co is currently generating about 0.02 per unit of risk. If you would invest 913.00 in Shenzhen Aisidi Co on September 4, 2024 and sell it today you would earn a total of 685.00 from holding Shenzhen Aisidi Co or generate 75.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Aisidi Co vs. Xiamen Bank Co
Performance |
| Timeline |
| Shenzhen Aisidi |
| Xiamen Bank |
Shenzhen Aisidi and Xiamen Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Aisidi and Xiamen Bank
The main advantage of trading using opposite Shenzhen Aisidi and Xiamen Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Aisidi position performs unexpectedly, Xiamen Bank 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 Xiamen Bank will offset losses from the drop in Xiamen Bank's long position.| Shenzhen Aisidi vs. Ningxia Building Materials | Shenzhen Aisidi vs. Kangxin New Materials | Shenzhen Aisidi vs. Sinosteel Luonai Materials | Shenzhen Aisidi vs. Shenzhen MYS Environmental |
| Xiamen Bank vs. Industrial and Commercial | Xiamen Bank vs. Agricultural Bank of | Xiamen Bank vs. China Construction Bank | Xiamen Bank vs. Bank of China |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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