Correlation Between First Capital and Chengdu Xingrong
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By analyzing existing cross correlation between First Capital Securities and Chengdu Xingrong Investment, you can compare the effects of market volatilities on First Capital and Chengdu Xingrong 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 First Capital with a short position of Chengdu Xingrong. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Capital and Chengdu Xingrong.
Diversification Opportunities for First Capital and Chengdu Xingrong
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between First and Chengdu is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding First Capital Securities and Chengdu Xingrong Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengdu Xingrong Inv and First Capital 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 First Capital Securities are associated (or correlated) with Chengdu Xingrong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengdu Xingrong Inv has no effect on the direction of First Capital i.e., First Capital and Chengdu Xingrong go up and down completely randomly.
Pair Corralation between First Capital and Chengdu Xingrong
Assuming the 90 days trading horizon First Capital is expected to generate 1.25 times less return on investment than Chengdu Xingrong. In addition to that, First Capital is 1.3 times more volatile than Chengdu Xingrong Investment. It trades about 0.04 of its total potential returns per unit of risk. Chengdu Xingrong Investment is currently generating about 0.06 per unit of volatility. If you would invest 485.00 in Chengdu Xingrong Investment on October 30, 2024 and sell it today you would earn a total of 246.00 from holding Chengdu Xingrong Investment or generate 50.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
First Capital Securities vs. Chengdu Xingrong Investment
Performance |
| Timeline |
| First Capital Securities |
| Chengdu Xingrong Inv |
First Capital and Chengdu Xingrong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Capital and Chengdu Xingrong
The main advantage of trading using opposite First Capital and Chengdu Xingrong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Capital position performs unexpectedly, Chengdu Xingrong 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 Chengdu Xingrong will offset losses from the drop in Chengdu Xingrong's long position.| First Capital vs. Ping An Insurance | First Capital vs. China Everbright Bank | First Capital vs. Hua Xia Bank | First Capital vs. HeNan Splendor Science |
| Chengdu Xingrong vs. Daoming OpticsChemical Co | Chengdu Xingrong vs. Tongling Nonferrous Metals | Chengdu Xingrong vs. Zhejiang Zhengguang Industrial | Chengdu Xingrong vs. Xilong Chemical 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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