Correlation Between Xinjiang Communications and East Money
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By analyzing existing cross correlation between Xinjiang Communications Construction and East Money Information, you can compare the effects of market volatilities on Xinjiang Communications and East Money 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 East Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Communications and East Money.
Diversification Opportunities for Xinjiang Communications and East Money
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xinjiang and East is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Communications Constr and East Money Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East Money Information 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 East Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East Money Information has no effect on the direction of Xinjiang Communications i.e., Xinjiang Communications and East Money go up and down completely randomly.
Pair Corralation between Xinjiang Communications and East Money
Assuming the 90 days trading horizon Xinjiang Communications Construction is expected to generate 0.65 times more return on investment than East Money. However, Xinjiang Communications Construction is 1.53 times less risky than East Money. It trades about 0.15 of its potential returns per unit of risk. East Money Information is currently generating about 0.08 per unit of risk. If you would invest 1,063 in Xinjiang Communications Construction on November 8, 2024 and sell it today you would earn a total of 46.00 from holding Xinjiang Communications Construction or generate 4.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Communications Constr vs. East Money Information
Performance |
| Timeline |
| Xinjiang Communications |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| East Money Information |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Xinjiang Communications and East Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Communications and East Money
The main advantage of trading using opposite Xinjiang Communications and East Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Communications position performs unexpectedly, East Money 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 East Money will offset losses from the drop in East Money's long position.The idea behind Xinjiang Communications Construction and East Money Information 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.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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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