Correlation Between Kunwu Jiuding and Xinjiang Zhongtai
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By analyzing existing cross correlation between Kunwu Jiuding Investment and Xinjiang Zhongtai Chemical, you can compare the effects of market volatilities on Kunwu Jiuding and Xinjiang Zhongtai 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 Kunwu Jiuding with a short position of Xinjiang Zhongtai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kunwu Jiuding and Xinjiang Zhongtai.
Diversification Opportunities for Kunwu Jiuding and Xinjiang Zhongtai
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kunwu and Xinjiang is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Kunwu Jiuding Investment and Xinjiang Zhongtai Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Zhongtai and Kunwu Jiuding 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 Kunwu Jiuding Investment are associated (or correlated) with Xinjiang Zhongtai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Zhongtai has no effect on the direction of Kunwu Jiuding i.e., Kunwu Jiuding and Xinjiang Zhongtai go up and down completely randomly.
Pair Corralation between Kunwu Jiuding and Xinjiang Zhongtai
Assuming the 90 days trading horizon Kunwu Jiuding Investment is expected to under-perform the Xinjiang Zhongtai. In addition to that, Kunwu Jiuding is 1.23 times more volatile than Xinjiang Zhongtai Chemical. It trades about -0.01 of its total potential returns per unit of risk. Xinjiang Zhongtai Chemical is currently generating about 0.18 per unit of volatility. If you would invest 434.00 in Xinjiang Zhongtai Chemical on September 14, 2024 and sell it today you would earn a total of 35.00 from holding Xinjiang Zhongtai Chemical or generate 8.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kunwu Jiuding Investment vs. Xinjiang Zhongtai Chemical
Performance |
| Timeline |
| Kunwu Jiuding Investment |
| Xinjiang Zhongtai |
Kunwu Jiuding and Xinjiang Zhongtai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kunwu Jiuding and Xinjiang Zhongtai
The main advantage of trading using opposite Kunwu Jiuding and Xinjiang Zhongtai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kunwu Jiuding position performs unexpectedly, Xinjiang Zhongtai 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 Zhongtai will offset losses from the drop in Xinjiang Zhongtai's long position.| Kunwu Jiuding vs. Lier Chemical Co | Kunwu Jiuding vs. Shenyang Chemical Industry | Kunwu Jiuding vs. Guangzhou Jinyi Media | Kunwu Jiuding vs. Beijing Jiaman Dress |
| Xinjiang Zhongtai vs. Linewell Software Co | Xinjiang Zhongtai vs. Hainan Mining Co | Xinjiang Zhongtai vs. Chenzhou Jingui Silver | Xinjiang Zhongtai vs. Fujian Rongji Software |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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