Correlation Between Chongqing Road and Xilinmen Furniture
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By analyzing existing cross correlation between Chongqing Road Bridge and Xilinmen Furniture Co, you can compare the effects of market volatilities on Chongqing Road and Xilinmen Furniture 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 Chongqing Road with a short position of Xilinmen Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Road and Xilinmen Furniture.
Diversification Opportunities for Chongqing Road and Xilinmen Furniture
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Chongqing and Xilinmen is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Road Bridge and Xilinmen Furniture Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xilinmen Furniture and Chongqing Road 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 Chongqing Road Bridge are associated (or correlated) with Xilinmen Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xilinmen Furniture has no effect on the direction of Chongqing Road i.e., Chongqing Road and Xilinmen Furniture go up and down completely randomly.
Pair Corralation between Chongqing Road and Xilinmen Furniture
Assuming the 90 days trading horizon Chongqing Road Bridge is expected to generate 1.42 times more return on investment than Xilinmen Furniture. However, Chongqing Road is 1.42 times more volatile than Xilinmen Furniture Co. It trades about 0.05 of its potential returns per unit of risk. Xilinmen Furniture Co is currently generating about 0.0 per unit of risk. If you would invest 488.00 in Chongqing Road Bridge on September 4, 2024 and sell it today you would earn a total of 194.00 from holding Chongqing Road Bridge or generate 39.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Road Bridge vs. Xilinmen Furniture Co
Performance |
| Timeline |
| Chongqing Road Bridge |
| Xilinmen Furniture |
Chongqing Road and Xilinmen Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Road and Xilinmen Furniture
The main advantage of trading using opposite Chongqing Road and Xilinmen Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Road position performs unexpectedly, Xilinmen Furniture 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 Xilinmen Furniture will offset losses from the drop in Xilinmen Furniture's long position.| Chongqing Road vs. Zhongtong Guomai Communication | Chongqing Road vs. XinJiang GuoTong Pipeline | Chongqing Road vs. Jiaozuo Wanfang Aluminum | Chongqing Road vs. Tongyu Communication |
| Xilinmen Furniture vs. Industrial and Commercial | Xilinmen Furniture vs. Agricultural Bank of | Xilinmen Furniture vs. China Construction Bank | Xilinmen Furniture vs. Bank of China |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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