Correlation Between Qingdao Rural and Xinjiang Baodi
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By analyzing existing cross correlation between Qingdao Rural Commercial and Xinjiang Baodi Mining, you can compare the effects of market volatilities on Qingdao Rural and Xinjiang Baodi 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 Qingdao Rural with a short position of Xinjiang Baodi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qingdao Rural and Xinjiang Baodi.
Diversification Opportunities for Qingdao Rural and Xinjiang Baodi
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Qingdao and Xinjiang is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Qingdao Rural Commercial and Xinjiang Baodi Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Baodi Mining and Qingdao Rural 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 Qingdao Rural Commercial are associated (or correlated) with Xinjiang Baodi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Baodi Mining has no effect on the direction of Qingdao Rural i.e., Qingdao Rural and Xinjiang Baodi go up and down completely randomly.
Pair Corralation between Qingdao Rural and Xinjiang Baodi
Assuming the 90 days trading horizon Qingdao Rural is expected to generate 1.91 times less return on investment than Xinjiang Baodi. But when comparing it to its historical volatility, Qingdao Rural Commercial is 1.22 times less risky than Xinjiang Baodi. It trades about 0.08 of its potential returns per unit of risk. Xinjiang Baodi Mining is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 647.00 in Xinjiang Baodi Mining on September 13, 2024 and sell it today you would earn a total of 40.00 from holding Xinjiang Baodi Mining or generate 6.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Qingdao Rural Commercial vs. Xinjiang Baodi Mining
Performance |
| Timeline |
| Qingdao Rural Commercial |
| Xinjiang Baodi Mining |
Qingdao Rural and Xinjiang Baodi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qingdao Rural and Xinjiang Baodi
The main advantage of trading using opposite Qingdao Rural and Xinjiang Baodi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qingdao Rural position performs unexpectedly, Xinjiang Baodi 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 Xinjiang Baodi will offset losses from the drop in Xinjiang Baodi's long position.| Qingdao Rural vs. Wintao Communications Co | Qingdao Rural vs. Innovative Medical Management | Qingdao Rural vs. Guangdong Shenglu Telecommunication | Qingdao Rural vs. Guangzhou Zhujiang Brewery |
| Xinjiang Baodi vs. Zijin Mining Group | Xinjiang Baodi vs. Wanhua Chemical Group | Xinjiang Baodi vs. Baoshan Iron Steel | Xinjiang Baodi vs. Shandong Gold Mining |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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