Correlation Between Xinjiang Communications and Shenzhen Noposion
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By analyzing existing cross correlation between Xinjiang Communications Construction and Shenzhen Noposion Agrochemicals, you can compare the effects of market volatilities on Xinjiang Communications and Shenzhen Noposion 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 Xinjiang Communications with a short position of Shenzhen Noposion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Communications and Shenzhen Noposion.
Diversification Opportunities for Xinjiang Communications and Shenzhen Noposion
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Xinjiang and Shenzhen is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Communications Constr and Shenzhen Noposion Agrochemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Noposion and Xinjiang Communications 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 Xinjiang Communications Construction are associated (or correlated) with Shenzhen Noposion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Noposion has no effect on the direction of Xinjiang Communications i.e., Xinjiang Communications and Shenzhen Noposion go up and down completely randomly.
Pair Corralation between Xinjiang Communications and Shenzhen Noposion
Assuming the 90 days trading horizon Xinjiang Communications is expected to generate 8.67 times less return on investment than Shenzhen Noposion. In addition to that, Xinjiang Communications is 1.03 times more volatile than Shenzhen Noposion Agrochemicals. It trades about 0.01 of its total potential returns per unit of risk. Shenzhen Noposion Agrochemicals is currently generating about 0.07 per unit of volatility. If you would invest 690.00 in Shenzhen Noposion Agrochemicals on October 20, 2024 and sell it today you would earn a total of 311.00 from holding Shenzhen Noposion Agrochemicals or generate 45.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Communications Constr vs. Shenzhen Noposion Agrochemical
Performance |
| Timeline |
| Xinjiang Communications |
| Shenzhen Noposion |
Xinjiang Communications and Shenzhen Noposion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Communications and Shenzhen Noposion
The main advantage of trading using opposite Xinjiang Communications and Shenzhen Noposion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Communications position performs unexpectedly, Shenzhen Noposion 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 Shenzhen Noposion will offset losses from the drop in Shenzhen Noposion's long position.The idea behind Xinjiang Communications Construction and Shenzhen Noposion Agrochemicals pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Shenzhen Noposion vs. Tongyu Communication | Shenzhen Noposion vs. Sinomach Automobile Co | Shenzhen Noposion vs. Shuhua Sports Co | Shenzhen Noposion vs. Hengdian Entertainment 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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