Correlation Between Xiamen CD and Sichuan Yahua
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By analyzing existing cross correlation between Xiamen CD and Sichuan Yahua Industrial, you can compare the effects of market volatilities on Xiamen CD and Sichuan Yahua 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 CD with a short position of Sichuan Yahua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen CD and Sichuan Yahua.
Diversification Opportunities for Xiamen CD and Sichuan Yahua
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xiamen and Sichuan is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen CD and Sichuan Yahua Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Yahua Industrial and Xiamen CD 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 CD are associated (or correlated) with Sichuan Yahua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Yahua Industrial has no effect on the direction of Xiamen CD i.e., Xiamen CD and Sichuan Yahua go up and down completely randomly.
Pair Corralation between Xiamen CD and Sichuan Yahua
Assuming the 90 days trading horizon Xiamen CD is expected to generate 1.05 times less return on investment than Sichuan Yahua. But when comparing it to its historical volatility, Xiamen CD is 1.12 times less risky than Sichuan Yahua. It trades about 0.18 of its potential returns per unit of risk. Sichuan Yahua Industrial is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 863.00 in Sichuan Yahua Industrial on September 3, 2024 and sell it today you would earn a total of 326.00 from holding Sichuan Yahua Industrial or generate 37.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen CD vs. Sichuan Yahua Industrial
Performance |
| Timeline |
| Xiamen CD |
| Sichuan Yahua Industrial |
Xiamen CD and Sichuan Yahua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen CD and Sichuan Yahua
The main advantage of trading using opposite Xiamen CD and Sichuan Yahua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen CD position performs unexpectedly, Sichuan Yahua 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 Sichuan Yahua will offset losses from the drop in Sichuan Yahua's long position.| Xiamen CD vs. Sichuan Yahua Industrial | Xiamen CD vs. Cofoe Medical Technology | Xiamen CD vs. Jiangxi Selon Industrial | Xiamen CD vs. Allmed Medical Products |
| Sichuan Yahua vs. Zijin Mining Group | Sichuan Yahua vs. Baoshan Iron Steel | Sichuan Yahua vs. Rongsheng Petrochemical Co | Sichuan Yahua vs. Hoshine Silicon Ind |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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