Correlation Between Xizi Clean and Hubei Xingfa
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By analyzing existing cross correlation between Xizi Clean Energy and Hubei Xingfa Chemicals, you can compare the effects of market volatilities on Xizi Clean and Hubei Xingfa 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 Xizi Clean with a short position of Hubei Xingfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xizi Clean and Hubei Xingfa.
Diversification Opportunities for Xizi Clean and Hubei Xingfa
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xizi and Hubei is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Xizi Clean Energy and Hubei Xingfa Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Xingfa Chemicals and Xizi Clean 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 Xizi Clean Energy are associated (or correlated) with Hubei Xingfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Xingfa Chemicals has no effect on the direction of Xizi Clean i.e., Xizi Clean and Hubei Xingfa go up and down completely randomly.
Pair Corralation between Xizi Clean and Hubei Xingfa
Assuming the 90 days trading horizon Xizi Clean Energy is expected to generate 0.88 times more return on investment than Hubei Xingfa. However, Xizi Clean Energy is 1.13 times less risky than Hubei Xingfa. It trades about -0.15 of its potential returns per unit of risk. Hubei Xingfa Chemicals is currently generating about -0.17 per unit of risk. If you would invest 1,260 in Xizi Clean Energy on September 12, 2024 and sell it today you would lose (78.00) from holding Xizi Clean Energy or give up 6.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xizi Clean Energy vs. Hubei Xingfa Chemicals
Performance |
| Timeline |
| Xizi Clean Energy |
| Hubei Xingfa Chemicals |
Xizi Clean and Hubei Xingfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xizi Clean and Hubei Xingfa
The main advantage of trading using opposite Xizi Clean and Hubei Xingfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xizi Clean position performs unexpectedly, Hubei Xingfa 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 Hubei Xingfa will offset losses from the drop in Hubei Xingfa's long position.| Xizi Clean vs. Agricultural Bank of | Xizi Clean vs. Industrial and Commercial | Xizi Clean vs. Bank of China | Xizi Clean vs. PetroChina Co Ltd |
| Hubei Xingfa vs. Zijin Mining Group | Hubei Xingfa vs. Wanhua Chemical Group | Hubei Xingfa vs. Baoshan Iron Steel | Hubei Xingfa vs. Rongsheng Petrochemical 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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