Correlation Between Chengdu Kanghua and Xingguang Agricultural
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By analyzing existing cross correlation between Chengdu Kanghua Biological and Xingguang Agricultural Mach, you can compare the effects of market volatilities on Chengdu Kanghua and Xingguang Agricultural 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 Chengdu Kanghua with a short position of Xingguang Agricultural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Kanghua and Xingguang Agricultural.
Diversification Opportunities for Chengdu Kanghua and Xingguang Agricultural
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Chengdu and Xingguang is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Kanghua Biological and Xingguang Agricultural Mach in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xingguang Agricultural and Chengdu Kanghua 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 Chengdu Kanghua Biological are associated (or correlated) with Xingguang Agricultural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xingguang Agricultural has no effect on the direction of Chengdu Kanghua i.e., Chengdu Kanghua and Xingguang Agricultural go up and down completely randomly.
Pair Corralation between Chengdu Kanghua and Xingguang Agricultural
Assuming the 90 days trading horizon Chengdu Kanghua Biological is expected to generate 0.43 times more return on investment than Xingguang Agricultural. However, Chengdu Kanghua Biological is 2.34 times less risky than Xingguang Agricultural. It trades about -0.32 of its potential returns per unit of risk. Xingguang Agricultural Mach is currently generating about -0.34 per unit of risk. If you would invest 5,685 in Chengdu Kanghua Biological on October 15, 2024 and sell it today you would lose (679.00) from holding Chengdu Kanghua Biological or give up 11.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Kanghua Biological vs. Xingguang Agricultural Mach
Performance |
| Timeline |
| Chengdu Kanghua Biol |
| Xingguang Agricultural |
Chengdu Kanghua and Xingguang Agricultural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Kanghua and Xingguang Agricultural
The main advantage of trading using opposite Chengdu Kanghua and Xingguang Agricultural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Kanghua position performs unexpectedly, Xingguang Agricultural 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 Xingguang Agricultural will offset losses from the drop in Xingguang Agricultural's long position.| Chengdu Kanghua vs. Zhongshan Public Utilities | Chengdu Kanghua vs. Longxing Chemical Stock | Chengdu Kanghua vs. Guizhou Chanhen Chemical | Chengdu Kanghua vs. CITIC Guoan Information |
| Xingguang Agricultural vs. Tianjin Silvery Dragon | Xingguang Agricultural vs. Kuang Chi Technologies | Xingguang Agricultural vs. Uroica Mining Safety | Xingguang Agricultural vs. Unisplendour Corp |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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