Correlation Between HaiXin Foods and Xiwang Foodstuffs
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By analyzing existing cross correlation between HaiXin Foods Co and Xiwang Foodstuffs Co, you can compare the effects of market volatilities on HaiXin Foods and Xiwang Foodstuffs 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 HaiXin Foods with a short position of Xiwang Foodstuffs. Check out your portfolio center. Please also check ongoing floating volatility patterns of HaiXin Foods and Xiwang Foodstuffs.
Diversification Opportunities for HaiXin Foods and Xiwang Foodstuffs
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HaiXin and Xiwang is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding HaiXin Foods Co and Xiwang Foodstuffs Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiwang Foodstuffs and HaiXin Foods 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 HaiXin Foods Co are associated (or correlated) with Xiwang Foodstuffs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiwang Foodstuffs has no effect on the direction of HaiXin Foods i.e., HaiXin Foods and Xiwang Foodstuffs go up and down completely randomly.
Pair Corralation between HaiXin Foods and Xiwang Foodstuffs
Assuming the 90 days trading horizon HaiXin Foods Co is expected to generate 1.61 times more return on investment than Xiwang Foodstuffs. However, HaiXin Foods is 1.61 times more volatile than Xiwang Foodstuffs Co. It trades about -0.07 of its potential returns per unit of risk. Xiwang Foodstuffs Co is currently generating about -0.16 per unit of risk. If you would invest 458.00 in HaiXin Foods Co on October 23, 2024 and sell it today you would lose (33.00) from holding HaiXin Foods Co or give up 7.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HaiXin Foods Co vs. Xiwang Foodstuffs Co
Performance |
| Timeline |
| HaiXin Foods |
| Xiwang Foodstuffs |
HaiXin Foods and Xiwang Foodstuffs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HaiXin Foods and Xiwang Foodstuffs
The main advantage of trading using opposite HaiXin Foods and Xiwang Foodstuffs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HaiXin Foods position performs unexpectedly, Xiwang Foodstuffs 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 Xiwang Foodstuffs will offset losses from the drop in Xiwang Foodstuffs' long position.| HaiXin Foods vs. Jointo Energy Investment | HaiXin Foods vs. Fiberhome Telecommunication Technologies | HaiXin Foods vs. Beijing Mainstreets Investment | HaiXin Foods vs. Jiangsu Yueda Investment |
| Xiwang Foodstuffs vs. Allwin Telecommunication Co | Xiwang Foodstuffs vs. Muyuan Foodstuff Co | Xiwang Foodstuffs vs. Beijing Bewinner Communications | Xiwang Foodstuffs vs. TianJin 712 Communication |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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