Correlation Between Xizi Clean and Shanghai Ziyan
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By analyzing existing cross correlation between Xizi Clean Energy and Shanghai Ziyan Foods, you can compare the effects of market volatilities on Xizi Clean and Shanghai Ziyan 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 Shanghai Ziyan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xizi Clean and Shanghai Ziyan.
Diversification Opportunities for Xizi Clean and Shanghai Ziyan
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xizi and Shanghai is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Xizi Clean Energy and Shanghai Ziyan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Ziyan Foods 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 Shanghai Ziyan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Ziyan Foods has no effect on the direction of Xizi Clean i.e., Xizi Clean and Shanghai Ziyan go up and down completely randomly.
Pair Corralation between Xizi Clean and Shanghai Ziyan
Assuming the 90 days trading horizon Xizi Clean Energy is expected to generate 0.6 times more return on investment than Shanghai Ziyan. However, Xizi Clean Energy is 1.66 times less risky than Shanghai Ziyan. It trades about 0.15 of its potential returns per unit of risk. Shanghai Ziyan Foods is currently generating about -0.07 per unit of risk. If you would invest 1,152 in Xizi Clean Energy on October 16, 2024 and sell it today you would earn a total of 99.00 from holding Xizi Clean Energy or generate 8.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xizi Clean Energy vs. Shanghai Ziyan Foods
Performance |
| Timeline |
| Xizi Clean Energy |
| Shanghai Ziyan Foods |
Xizi Clean and Shanghai Ziyan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xizi Clean and Shanghai Ziyan
The main advantage of trading using opposite Xizi Clean and Shanghai Ziyan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xizi Clean position performs unexpectedly, Shanghai Ziyan 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 Shanghai Ziyan will offset losses from the drop in Shanghai Ziyan's long position.| Xizi Clean vs. Ningxia Younglight Chemicals | Xizi Clean vs. Western Mining Co | Xizi Clean vs. Hubei Xingfa Chemicals | Xizi Clean vs. Changjiang Publishing Media |
| Shanghai Ziyan vs. Nanjing Putian Telecommunications | Shanghai Ziyan vs. Songz Automobile Air | Shanghai Ziyan vs. Fiberhome Telecommunication Technologies | Shanghai Ziyan vs. Dymatic Chemicals |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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