Correlation Between Gansu Yasheng and Xinke Material
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By analyzing existing cross correlation between Gansu Yasheng Industrial and Xinke Material, you can compare the effects of market volatilities on Gansu Yasheng and Xinke Material 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 Gansu Yasheng with a short position of Xinke Material. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gansu Yasheng and Xinke Material.
Diversification Opportunities for Gansu Yasheng and Xinke Material
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Gansu and Xinke is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Gansu Yasheng Industrial and Xinke Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinke Material and Gansu Yasheng 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 Gansu Yasheng Industrial are associated (or correlated) with Xinke Material. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinke Material has no effect on the direction of Gansu Yasheng i.e., Gansu Yasheng and Xinke Material go up and down completely randomly.
Pair Corralation between Gansu Yasheng and Xinke Material
Assuming the 90 days trading horizon Gansu Yasheng Industrial is expected to generate 0.65 times more return on investment than Xinke Material. However, Gansu Yasheng Industrial is 1.54 times less risky than Xinke Material. It trades about 0.0 of its potential returns per unit of risk. Xinke Material is currently generating about 0.0 per unit of risk. If you would invest 321.00 in Gansu Yasheng Industrial on August 30, 2024 and sell it today you would lose (23.00) from holding Gansu Yasheng Industrial or give up 7.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gansu Yasheng Industrial vs. Xinke Material
Performance |
| Timeline |
| Gansu Yasheng Industrial |
| Xinke Material |
Gansu Yasheng and Xinke Material Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gansu Yasheng and Xinke Material
The main advantage of trading using opposite Gansu Yasheng and Xinke Material positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gansu Yasheng position performs unexpectedly, Xinke Material 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 Xinke Material will offset losses from the drop in Xinke Material's long position.| Gansu Yasheng vs. PetroChina Co Ltd | Gansu Yasheng vs. China Mobile Limited | Gansu Yasheng vs. Ping An Insurance | Gansu Yasheng vs. China Petroleum Chemical |
| Xinke Material vs. Shandong Gold Mining | Xinke Material vs. Rongsheng Petrochemical Co | Xinke Material vs. Inner Mongolia BaoTou | Xinke Material vs. Jiangxi Ganfeng Lithium |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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