Correlation Between Xilong Chemical and Emdoor Information
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By analyzing existing cross correlation between Xilong Chemical Co and Emdoor Information Co, you can compare the effects of market volatilities on Xilong Chemical and Emdoor Information 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 Emdoor Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xilong Chemical and Emdoor Information.
Diversification Opportunities for Xilong Chemical and Emdoor Information
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xilong and Emdoor is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Xilong Chemical Co and Emdoor Information Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emdoor Information 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 Emdoor Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emdoor Information has no effect on the direction of Xilong Chemical i.e., Xilong Chemical and Emdoor Information go up and down completely randomly.
Pair Corralation between Xilong Chemical and Emdoor Information
Assuming the 90 days trading horizon Xilong Chemical Co is expected to under-perform the Emdoor Information. But the stock apears to be less risky and, when comparing its historical volatility, Xilong Chemical Co is 1.28 times less risky than Emdoor Information. The stock trades about -0.16 of its potential returns per unit of risk. The Emdoor Information Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 5,278 in Emdoor Information Co on September 29, 2024 and sell it today you would earn a total of 122.00 from holding Emdoor Information Co or generate 2.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xilong Chemical Co vs. Emdoor Information Co
Performance |
| Timeline |
| Xilong Chemical |
| Emdoor Information |
Xilong Chemical and Emdoor Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xilong Chemical and Emdoor Information
The main advantage of trading using opposite Xilong Chemical and Emdoor Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xilong Chemical position performs unexpectedly, Emdoor Information 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 Emdoor Information will offset losses from the drop in Emdoor Information'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 |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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