Correlation Between Xinjiang Communications and New Hope
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By analyzing existing cross correlation between Xinjiang Communications Construction and New Hope Dairy, you can compare the effects of market volatilities on Xinjiang Communications and New Hope 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 New Hope. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Communications and New Hope.
Diversification Opportunities for Xinjiang Communications and New Hope
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xinjiang and New is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Communications Constr and New Hope Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Hope Dairy 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 New Hope. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Hope Dairy has no effect on the direction of Xinjiang Communications i.e., Xinjiang Communications and New Hope go up and down completely randomly.
Pair Corralation between Xinjiang Communications and New Hope
Assuming the 90 days trading horizon Xinjiang Communications Construction is expected to generate 1.29 times more return on investment than New Hope. However, Xinjiang Communications is 1.29 times more volatile than New Hope Dairy. It trades about 0.2 of its potential returns per unit of risk. New Hope Dairy is currently generating about 0.13 per unit of risk. If you would invest 1,138 in Xinjiang Communications Construction on September 1, 2024 and sell it today you would earn a total of 142.00 from holding Xinjiang Communications Construction or generate 12.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Communications Constr vs. New Hope Dairy
Performance |
| Timeline |
| Xinjiang Communications |
| New Hope Dairy |
Xinjiang Communications and New Hope Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Communications and New Hope
The main advantage of trading using opposite Xinjiang Communications and New Hope positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Communications position performs unexpectedly, New Hope 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 New Hope will offset losses from the drop in New Hope's long position.| Xinjiang Communications vs. Ming Yang Smart | Xinjiang Communications vs. 159681 | Xinjiang Communications vs. 159005 | Xinjiang Communications vs. Loctek Ergonomic Technology |
| New Hope vs. Nanjing Putian Telecommunications | New Hope vs. Shenzhen Hifuture Electric | New Hope vs. Tianjin Realty Development | New Hope vs. Shenyang Huitian Thermal |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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