Correlation Between Centre Testing and Xiangyang Automobile
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By analyzing existing cross correlation between Centre Testing Intl and Xiangyang Automobile Bearing, you can compare the effects of market volatilities on Centre Testing and Xiangyang Automobile 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 Centre Testing with a short position of Xiangyang Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centre Testing and Xiangyang Automobile.
Diversification Opportunities for Centre Testing and Xiangyang Automobile
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Centre and Xiangyang is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Centre Testing Intl and Xiangyang Automobile Bearing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiangyang Automobile and Centre Testing 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 Centre Testing Intl are associated (or correlated) with Xiangyang Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiangyang Automobile has no effect on the direction of Centre Testing i.e., Centre Testing and Xiangyang Automobile go up and down completely randomly.
Pair Corralation between Centre Testing and Xiangyang Automobile
Assuming the 90 days trading horizon Centre Testing Intl is expected to under-perform the Xiangyang Automobile. But the stock apears to be less risky and, when comparing its historical volatility, Centre Testing Intl is 2.07 times less risky than Xiangyang Automobile. The stock trades about -0.31 of its potential returns per unit of risk. The Xiangyang Automobile Bearing is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 675.00 in Xiangyang Automobile Bearing on September 12, 2024 and sell it today you would earn a total of 104.00 from holding Xiangyang Automobile Bearing or generate 15.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centre Testing Intl vs. Xiangyang Automobile Bearing
Performance |
| Timeline |
| Centre Testing Intl |
| Xiangyang Automobile |
Centre Testing and Xiangyang Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centre Testing and Xiangyang Automobile
The main advantage of trading using opposite Centre Testing and Xiangyang Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centre Testing position performs unexpectedly, Xiangyang Automobile 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 Xiangyang Automobile will offset losses from the drop in Xiangyang Automobile's long position.| Centre Testing vs. Easyhome New Retail | Centre Testing vs. Tongling Nonferrous Metals | Centre Testing vs. CITIC Metal Co | Centre Testing vs. Shanghai Shuixing Home |
| Xiangyang Automobile vs. Lutian Machinery Co | Xiangyang Automobile vs. PetroChina Co Ltd | Xiangyang Automobile vs. Bank of China | Xiangyang Automobile vs. Gansu Jiu Steel |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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