Correlation Between Chengdu Xinzhu and Beijing Sanyuan
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By analyzing existing cross correlation between Chengdu Xinzhu RoadBridge and Beijing Sanyuan Foods, you can compare the effects of market volatilities on Chengdu Xinzhu and Beijing Sanyuan 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 Chengdu Xinzhu with a short position of Beijing Sanyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Xinzhu and Beijing Sanyuan.
Diversification Opportunities for Chengdu Xinzhu and Beijing Sanyuan
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chengdu and Beijing is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Xinzhu RoadBridge and Beijing Sanyuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Sanyuan Foods and Chengdu Xinzhu 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 Chengdu Xinzhu RoadBridge are associated (or correlated) with Beijing Sanyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Sanyuan Foods has no effect on the direction of Chengdu Xinzhu i.e., Chengdu Xinzhu and Beijing Sanyuan go up and down completely randomly.
Pair Corralation between Chengdu Xinzhu and Beijing Sanyuan
Assuming the 90 days trading horizon Chengdu Xinzhu RoadBridge is expected to generate 1.46 times more return on investment than Beijing Sanyuan. However, Chengdu Xinzhu is 1.46 times more volatile than Beijing Sanyuan Foods. It trades about 0.02 of its potential returns per unit of risk. Beijing Sanyuan Foods is currently generating about -0.07 per unit of risk. If you would invest 527.00 in Chengdu Xinzhu RoadBridge on October 30, 2024 and sell it today you would earn a total of 3.00 from holding Chengdu Xinzhu RoadBridge or generate 0.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Xinzhu RoadBridge vs. Beijing Sanyuan Foods
Performance |
| Timeline |
| Chengdu Xinzhu RoadBridge |
| Beijing Sanyuan Foods |
Chengdu Xinzhu and Beijing Sanyuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Xinzhu and Beijing Sanyuan
The main advantage of trading using opposite Chengdu Xinzhu and Beijing Sanyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Xinzhu position performs unexpectedly, Beijing Sanyuan 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 Beijing Sanyuan will offset losses from the drop in Beijing Sanyuan's long position.| Chengdu Xinzhu vs. Beijing Seeyon Internet | Chengdu Xinzhu vs. Sichuan Jinshi Technology | Chengdu Xinzhu vs. Dazhong Transportation Group | Chengdu Xinzhu vs. Shenzhen Urban Transport |
| Beijing Sanyuan vs. Shandong Rike Chemical | Beijing Sanyuan vs. Lander Sports Development | Beijing Sanyuan vs. Daoming OpticsChemical Co | Beijing Sanyuan vs. Xilong Chemical 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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