Correlation Between Xinjiang Communications and Lushang Property
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By analyzing existing cross correlation between Xinjiang Communications Construction and Lushang Property Co, you can compare the effects of market volatilities on Xinjiang Communications and Lushang Property 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 Lushang Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Communications and Lushang Property.
Diversification Opportunities for Xinjiang Communications and Lushang Property
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xinjiang and Lushang is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Communications Constr and Lushang Property Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lushang Property 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 Lushang Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lushang Property has no effect on the direction of Xinjiang Communications i.e., Xinjiang Communications and Lushang Property go up and down completely randomly.
Pair Corralation between Xinjiang Communications and Lushang Property
Assuming the 90 days trading horizon Xinjiang Communications Construction is expected to generate 0.96 times more return on investment than Lushang Property. However, Xinjiang Communications Construction is 1.04 times less risky than Lushang Property. It trades about 0.13 of its potential returns per unit of risk. Lushang Property Co is currently generating about 0.02 per unit of risk. If you would invest 1,252 in Xinjiang Communications Construction on September 13, 2024 and sell it today you would earn a total of 56.00 from holding Xinjiang Communications Construction or generate 4.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Communications Constr vs. Lushang Property Co
Performance |
| Timeline |
| Xinjiang Communications |
| Lushang Property |
Xinjiang Communications and Lushang Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Communications and Lushang Property
The main advantage of trading using opposite Xinjiang Communications and Lushang Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Communications position performs unexpectedly, Lushang Property 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 Lushang Property will offset losses from the drop in Lushang Property's long position.| Xinjiang Communications vs. Industrial and Commercial | Xinjiang Communications vs. Kweichow Moutai Co | Xinjiang Communications vs. Agricultural Bank of | Xinjiang Communications vs. China Mobile Limited |
| Lushang Property vs. Wuhan Yangtze Communication | Lushang Property vs. Xinjiang Communications Construction | Lushang Property vs. Shenzhen Kexin Communication | Lushang Property vs. Guangdong Jingyi Metal |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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