Correlation Between Beijing HuaYuanYiTong and Xizi Clean
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By analyzing existing cross correlation between Beijing HuaYuanYiTong Thermal and Xizi Clean Energy, you can compare the effects of market volatilities on Beijing HuaYuanYiTong and Xizi Clean 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 Beijing HuaYuanYiTong with a short position of Xizi Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing HuaYuanYiTong and Xizi Clean.
Diversification Opportunities for Beijing HuaYuanYiTong and Xizi Clean
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Beijing and Xizi is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Beijing HuaYuanYiTong Thermal and Xizi Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xizi Clean Energy and Beijing HuaYuanYiTong 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 Beijing HuaYuanYiTong Thermal are associated (or correlated) with Xizi Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xizi Clean Energy has no effect on the direction of Beijing HuaYuanYiTong i.e., Beijing HuaYuanYiTong and Xizi Clean go up and down completely randomly.
Pair Corralation between Beijing HuaYuanYiTong and Xizi Clean
Assuming the 90 days trading horizon Beijing HuaYuanYiTong Thermal is expected to generate 1.68 times more return on investment than Xizi Clean. However, Beijing HuaYuanYiTong is 1.68 times more volatile than Xizi Clean Energy. It trades about 0.04 of its potential returns per unit of risk. Xizi Clean Energy is currently generating about -0.17 per unit of risk. If you would invest 1,151 in Beijing HuaYuanYiTong Thermal on September 1, 2024 and sell it today you would earn a total of 21.00 from holding Beijing HuaYuanYiTong Thermal or generate 1.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing HuaYuanYiTong Thermal vs. Xizi Clean Energy
Performance |
| Timeline |
| Beijing HuaYuanYiTong |
| Xizi Clean Energy |
Beijing HuaYuanYiTong and Xizi Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing HuaYuanYiTong and Xizi Clean
The main advantage of trading using opposite Beijing HuaYuanYiTong and Xizi Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing HuaYuanYiTong position performs unexpectedly, Xizi Clean 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 Xizi Clean will offset losses from the drop in Xizi Clean's long position.| Beijing HuaYuanYiTong vs. Industrial and Commercial | Beijing HuaYuanYiTong vs. Agricultural Bank of | Beijing HuaYuanYiTong vs. China Construction Bank | Beijing HuaYuanYiTong vs. Bank of China |
| Xizi Clean vs. Miracll Chemicals Co | Xizi Clean vs. Ningbo Kangqiang Electronics | Xizi Clean vs. Ping An Insurance | Xizi Clean vs. Leyard Optoelectronic |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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