Correlation Between Xilong Chemical and China Reform
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By analyzing existing cross correlation between Xilong Chemical Co and China Reform Health, you can compare the effects of market volatilities on Xilong Chemical and China Reform 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 Xilong Chemical with a short position of China Reform. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xilong Chemical and China Reform.
Diversification Opportunities for Xilong Chemical and China Reform
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Xilong and China is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Xilong Chemical Co and China Reform Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Reform Health and Xilong Chemical 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 Xilong Chemical Co are associated (or correlated) with China Reform. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Reform Health has no effect on the direction of Xilong Chemical i.e., Xilong Chemical and China Reform go up and down completely randomly.
Pair Corralation between Xilong Chemical and China Reform
Assuming the 90 days trading horizon Xilong Chemical Co is expected to generate 0.91 times more return on investment than China Reform. However, Xilong Chemical Co is 1.1 times less risky than China Reform. It trades about 0.04 of its potential returns per unit of risk. China Reform Health is currently generating about 0.03 per unit of risk. If you would invest 679.00 in Xilong Chemical Co on October 29, 2024 and sell it today you would earn a total of 114.00 from holding Xilong Chemical Co or generate 16.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xilong Chemical Co vs. China Reform Health
Performance |
| Timeline |
| Xilong Chemical |
| China Reform Health |
Xilong Chemical and China Reform Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xilong Chemical and China Reform
The main advantage of trading using opposite Xilong Chemical and China Reform positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xilong Chemical position performs unexpectedly, China Reform 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 China Reform will offset losses from the drop in China Reform's long position.| Xilong Chemical vs. Chengtun Mining Group | Xilong Chemical vs. Ningbo Fujia Industrial | Xilong Chemical vs. Huizhou Speed Wireless | Xilong Chemical vs. Citic Guoan Wine |
| China Reform vs. CICT Mobile Communication | China Reform vs. Eit Environmental Development | China Reform vs. Bank of Communications | China Reform vs. Allwin Telecommunication 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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