Correlation Between Xinjiang Communications and Markor International
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By analyzing existing cross correlation between Xinjiang Communications Construction and Markor International Home, you can compare the effects of market volatilities on Xinjiang Communications and Markor International 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 Markor International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Communications and Markor International.
Diversification Opportunities for Xinjiang Communications and Markor International
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xinjiang and Markor is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Communications Constr and Markor International Home in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Markor International Home 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 Markor International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Markor International Home has no effect on the direction of Xinjiang Communications i.e., Xinjiang Communications and Markor International go up and down completely randomly.
Pair Corralation between Xinjiang Communications and Markor International
Assuming the 90 days trading horizon Xinjiang Communications Construction is expected to generate 0.79 times more return on investment than Markor International. However, Xinjiang Communications Construction is 1.27 times less risky than Markor International. It trades about 0.06 of its potential returns per unit of risk. Markor International Home is currently generating about 0.02 per unit of risk. If you would invest 870.00 in Xinjiang Communications Construction on October 18, 2024 and sell it today you would earn a total of 183.00 from holding Xinjiang Communications Construction or generate 21.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.17% |
| Values | Daily Returns |
Xinjiang Communications Constr vs. Markor International Home
Performance |
| Timeline |
| Xinjiang Communications |
| Markor International Home |
Xinjiang Communications and Markor International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Communications and Markor International
The main advantage of trading using opposite Xinjiang Communications and Markor International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Communications position performs unexpectedly, Markor International 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 Markor International will offset losses from the drop in Markor International's long position.The idea behind Xinjiang Communications Construction and Markor International Home 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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