Correlation Between Guizhou Chanhen and Xiangyang Automobile
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By analyzing existing cross correlation between Guizhou Chanhen Chemical and Xiangyang Automobile Bearing, you can compare the effects of market volatilities on Guizhou Chanhen and Xiangyang Automobile 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 Guizhou Chanhen with a short position of Xiangyang Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guizhou Chanhen and Xiangyang Automobile.
Diversification Opportunities for Guizhou Chanhen and Xiangyang Automobile
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guizhou and Xiangyang is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Guizhou Chanhen Chemical and Xiangyang Automobile Bearing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiangyang Automobile and Guizhou Chanhen 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 Guizhou Chanhen Chemical are associated (or correlated) with Xiangyang Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiangyang Automobile has no effect on the direction of Guizhou Chanhen i.e., Guizhou Chanhen and Xiangyang Automobile go up and down completely randomly.
Pair Corralation between Guizhou Chanhen and Xiangyang Automobile
Assuming the 90 days trading horizon Guizhou Chanhen Chemical is expected to under-perform the Xiangyang Automobile. But the stock apears to be less risky and, when comparing its historical volatility, Guizhou Chanhen Chemical is 2.13 times less risky than Xiangyang Automobile. The stock trades about -0.29 of its potential returns per unit of risk. The Xiangyang Automobile Bearing is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 696.00 in Xiangyang Automobile Bearing on October 29, 2024 and sell it today you would lose (47.00) from holding Xiangyang Automobile Bearing or give up 6.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guizhou Chanhen Chemical vs. Xiangyang Automobile Bearing
Performance |
| Timeline |
| Guizhou Chanhen Chemical |
| Xiangyang Automobile |
Guizhou Chanhen and Xiangyang Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guizhou Chanhen and Xiangyang Automobile
The main advantage of trading using opposite Guizhou Chanhen and Xiangyang Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guizhou Chanhen position performs unexpectedly, Xiangyang Automobile 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 Xiangyang Automobile will offset losses from the drop in Xiangyang Automobile's long position.| Guizhou Chanhen vs. Linzhou Heavy Machinery | Guizhou Chanhen vs. Tjk Machinery Tianjin | Guizhou Chanhen vs. Shanghai Construction Group | Guizhou Chanhen vs. Hubei Geoway Investment |
| Xiangyang Automobile vs. Guangzhou Jinyi Media | Xiangyang Automobile vs. Duzhe Publishing Media | Xiangyang Automobile vs. Shanghai Xinhua Media | Xiangyang Automobile vs. Beijing YanDong MicroElectronic |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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