Correlation Between XiaMen HongXin and Zhejiang JIULI
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By analyzing existing cross correlation between XiaMen HongXin Electron tech and Zhejiang JIULI Hi tech, you can compare the effects of market volatilities on XiaMen HongXin and Zhejiang JIULI 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 XiaMen HongXin with a short position of Zhejiang JIULI. Check out your portfolio center. Please also check ongoing floating volatility patterns of XiaMen HongXin and Zhejiang JIULI.
Diversification Opportunities for XiaMen HongXin and Zhejiang JIULI
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between XiaMen and Zhejiang is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding XiaMen HongXin Electron tech and Zhejiang JIULI Hi tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang JIULI Hi and XiaMen HongXin 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 XiaMen HongXin Electron tech are associated (or correlated) with Zhejiang JIULI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang JIULI Hi has no effect on the direction of XiaMen HongXin i.e., XiaMen HongXin and Zhejiang JIULI go up and down completely randomly.
Pair Corralation between XiaMen HongXin and Zhejiang JIULI
Assuming the 90 days trading horizon XiaMen HongXin is expected to generate 1.47 times less return on investment than Zhejiang JIULI. In addition to that, XiaMen HongXin is 6.05 times more volatile than Zhejiang JIULI Hi tech. It trades about 0.06 of its total potential returns per unit of risk. Zhejiang JIULI Hi tech is currently generating about 0.54 per unit of volatility. If you would invest 2,274 in Zhejiang JIULI Hi tech on November 4, 2024 and sell it today you would earn a total of 206.00 from holding Zhejiang JIULI Hi tech or generate 9.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
XiaMen HongXin Electron tech vs. Zhejiang JIULI Hi tech
Performance |
| Timeline |
| XiaMen HongXin Electron |
| Zhejiang JIULI Hi |
XiaMen HongXin and Zhejiang JIULI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XiaMen HongXin and Zhejiang JIULI
The main advantage of trading using opposite XiaMen HongXin and Zhejiang JIULI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XiaMen HongXin position performs unexpectedly, Zhejiang JIULI 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 Zhejiang JIULI will offset losses from the drop in Zhejiang JIULI's long position.| XiaMen HongXin vs. Allwin Telecommunication Co | XiaMen HongXin vs. Bank of Communications | XiaMen HongXin vs. State Grid InformationCommunication | XiaMen HongXin vs. Bomesc Offshore Engineering |
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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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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