Correlation Between Kuang Chi and Xinjiang Baodi
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By analyzing existing cross correlation between Kuang Chi Technologies and Xinjiang Baodi Mining, you can compare the effects of market volatilities on Kuang Chi and Xinjiang Baodi 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 Kuang Chi with a short position of Xinjiang Baodi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuang Chi and Xinjiang Baodi.
Diversification Opportunities for Kuang Chi and Xinjiang Baodi
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kuang and Xinjiang is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Kuang Chi Technologies and Xinjiang Baodi Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Baodi Mining and Kuang Chi 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 Kuang Chi Technologies are associated (or correlated) with Xinjiang Baodi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Baodi Mining has no effect on the direction of Kuang Chi i.e., Kuang Chi and Xinjiang Baodi go up and down completely randomly.
Pair Corralation between Kuang Chi and Xinjiang Baodi
Assuming the 90 days trading horizon Kuang Chi Technologies is expected to generate 1.3 times more return on investment than Xinjiang Baodi. However, Kuang Chi is 1.3 times more volatile than Xinjiang Baodi Mining. It trades about 0.02 of its potential returns per unit of risk. Xinjiang Baodi Mining is currently generating about -0.07 per unit of risk. If you would invest 4,038 in Kuang Chi Technologies on November 3, 2024 and sell it today you would earn a total of 27.00 from holding Kuang Chi Technologies or generate 0.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kuang Chi Technologies vs. Xinjiang Baodi Mining
Performance |
| Timeline |
| Kuang Chi Technologies |
| Xinjiang Baodi Mining |
Kuang Chi and Xinjiang Baodi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kuang Chi and Xinjiang Baodi
The main advantage of trading using opposite Kuang Chi and Xinjiang Baodi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kuang Chi position performs unexpectedly, Xinjiang Baodi 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 Xinjiang Baodi will offset losses from the drop in Xinjiang Baodi's long position.| Kuang Chi vs. Industrial and Commercial | Kuang Chi vs. Agricultural Bank of | Kuang Chi vs. China Construction Bank | Kuang Chi vs. Bank of China |
| Xinjiang Baodi vs. Zijin Mining Group | Xinjiang Baodi vs. Wanhua Chemical Group | Xinjiang Baodi vs. Baoshan Iron Steel | Xinjiang Baodi 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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