Correlation Between Xinjiang Tianrun and Xilong Chemical
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By analyzing existing cross correlation between Xinjiang Tianrun Dairy and Xilong Chemical Co, you can compare the effects of market volatilities on Xinjiang Tianrun and Xilong Chemical 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 Xinjiang Tianrun with a short position of Xilong Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Tianrun and Xilong Chemical.
Diversification Opportunities for Xinjiang Tianrun and Xilong Chemical
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xinjiang and Xilong is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Tianrun Dairy and Xilong Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xilong Chemical and Xinjiang Tianrun 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 Xinjiang Tianrun Dairy are associated (or correlated) with Xilong Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xilong Chemical has no effect on the direction of Xinjiang Tianrun i.e., Xinjiang Tianrun and Xilong Chemical go up and down completely randomly.
Pair Corralation between Xinjiang Tianrun and Xilong Chemical
Assuming the 90 days trading horizon Xinjiang Tianrun is expected to generate 1.21 times less return on investment than Xilong Chemical. But when comparing it to its historical volatility, Xinjiang Tianrun Dairy is 1.84 times less risky than Xilong Chemical. It trades about 0.2 of its potential returns per unit of risk. Xilong Chemical Co is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 792.00 in Xilong Chemical Co on September 4, 2024 and sell it today you would earn a total of 85.00 from holding Xilong Chemical Co or generate 10.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Tianrun Dairy vs. Xilong Chemical Co
Performance |
| Timeline |
| Xinjiang Tianrun Dairy |
| Xilong Chemical |
Xinjiang Tianrun and Xilong Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Tianrun and Xilong Chemical
The main advantage of trading using opposite Xinjiang Tianrun and Xilong Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Tianrun position performs unexpectedly, Xilong Chemical 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 Xilong Chemical will offset losses from the drop in Xilong Chemical's long position.| Xinjiang Tianrun vs. Xilong Chemical Co | Xinjiang Tianrun vs. China Publishing Media | Xinjiang Tianrun vs. Miracll Chemicals Co | Xinjiang Tianrun vs. Xiangtan Electrochemical Scientific |
| Xilong Chemical vs. Shenzhen Clou Electronics | Xilong Chemical vs. Dongguan Tarry Electronics | Xilong Chemical vs. Industrial Bank Co | Xilong Chemical vs. Hangzhou Weiguang Electronic |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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