Correlation Between Xilong Chemical and Ningxia Younglight
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By analyzing existing cross correlation between Xilong Chemical Co and Ningxia Younglight Chemicals, you can compare the effects of market volatilities on Xilong Chemical and Ningxia Younglight 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 Ningxia Younglight. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xilong Chemical and Ningxia Younglight.
Diversification Opportunities for Xilong Chemical and Ningxia Younglight
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xilong and Ningxia is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Xilong Chemical Co and Ningxia Younglight Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningxia Younglight 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 Ningxia Younglight. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningxia Younglight has no effect on the direction of Xilong Chemical i.e., Xilong Chemical and Ningxia Younglight go up and down completely randomly.
Pair Corralation between Xilong Chemical and Ningxia Younglight
Assuming the 90 days trading horizon Xilong Chemical Co is expected to generate 1.18 times more return on investment than Ningxia Younglight. However, Xilong Chemical is 1.18 times more volatile than Ningxia Younglight Chemicals. It trades about 0.02 of its potential returns per unit of risk. Ningxia Younglight Chemicals is currently generating about 0.0 per unit of risk. If you would invest 683.00 in Xilong Chemical Co on October 10, 2024 and sell it today you would earn a total of 61.00 from holding Xilong Chemical Co or generate 8.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xilong Chemical Co vs. Ningxia Younglight Chemicals
Performance |
| Timeline |
| Xilong Chemical |
| Ningxia Younglight |
Xilong Chemical and Ningxia Younglight Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xilong Chemical and Ningxia Younglight
The main advantage of trading using opposite Xilong Chemical and Ningxia Younglight positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xilong Chemical position performs unexpectedly, Ningxia Younglight 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 Ningxia Younglight will offset losses from the drop in Ningxia Younglight's long position.| Xilong Chemical vs. Zijin Mining Group | Xilong Chemical vs. Wanhua Chemical Group | Xilong Chemical vs. Baoshan Iron Steel | Xilong Chemical vs. Shandong Gold Mining |
| Ningxia Younglight vs. Hangzhou Guotai Environmental | Ningxia Younglight vs. Soyea Technology Co | Ningxia Younglight vs. Bangyan Technology Co | Ningxia Younglight vs. Guangdong Xiongsu Technology |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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