Correlation Between Wuhan Yangtze and Xingguang Agricultural
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By analyzing existing cross correlation between Wuhan Yangtze Communication and Xingguang Agricultural Mach, you can compare the effects of market volatilities on Wuhan Yangtze 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 Wuhan Yangtze with a short position of Xingguang Agricultural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuhan Yangtze and Xingguang Agricultural.
Diversification Opportunities for Wuhan Yangtze and Xingguang Agricultural
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wuhan and Xingguang is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Wuhan Yangtze Communication and Xingguang Agricultural Mach in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xingguang Agricultural and Wuhan Yangtze 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 Wuhan Yangtze Communication 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 Wuhan Yangtze i.e., Wuhan Yangtze and Xingguang Agricultural go up and down completely randomly.
Pair Corralation between Wuhan Yangtze and Xingguang Agricultural
Assuming the 90 days trading horizon Wuhan Yangtze Communication is expected to generate 0.96 times more return on investment than Xingguang Agricultural. However, Wuhan Yangtze Communication is 1.04 times less risky than Xingguang Agricultural. It trades about -0.17 of its potential returns per unit of risk. Xingguang Agricultural Mach is currently generating about -0.25 per unit of risk. If you would invest 2,413 in Wuhan Yangtze Communication on October 25, 2024 and sell it today you would lose (221.00) from holding Wuhan Yangtze Communication or give up 9.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wuhan Yangtze Communication vs. Xingguang Agricultural Mach
Performance |
| Timeline |
| Wuhan Yangtze Commun |
| Xingguang Agricultural |
Wuhan Yangtze and Xingguang Agricultural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wuhan Yangtze and Xingguang Agricultural
The main advantage of trading using opposite Wuhan Yangtze and Xingguang Agricultural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuhan Yangtze 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.| Wuhan Yangtze vs. Kweichow Moutai Co | Wuhan Yangtze vs. NAURA Technology Group | Wuhan Yangtze vs. APT Medical | Wuhan Yangtze vs. BYD Co Ltd |
| Xingguang Agricultural vs. Kweichow Moutai Co | Xingguang Agricultural vs. Contemporary Amperex Technology | Xingguang Agricultural vs. Beijing Roborock Technology | Xingguang Agricultural vs. BYD Co Ltd |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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