Correlation Between Beijing Sanyuan and Xinjiang Communications
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By analyzing existing cross correlation between Beijing Sanyuan Foods and Xinjiang Communications Construction, you can compare the effects of market volatilities on Beijing Sanyuan and Xinjiang Communications 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 Beijing Sanyuan with a short position of Xinjiang Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Sanyuan and Xinjiang Communications.
Diversification Opportunities for Beijing Sanyuan and Xinjiang Communications
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Beijing and Xinjiang is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Sanyuan Foods and Xinjiang Communications Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Communications and Beijing Sanyuan 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 Beijing Sanyuan Foods are associated (or correlated) with Xinjiang Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Communications has no effect on the direction of Beijing Sanyuan i.e., Beijing Sanyuan and Xinjiang Communications go up and down completely randomly.
Pair Corralation between Beijing Sanyuan and Xinjiang Communications
Assuming the 90 days trading horizon Beijing Sanyuan Foods is expected to generate 1.83 times more return on investment than Xinjiang Communications. However, Beijing Sanyuan is 1.83 times more volatile than Xinjiang Communications Construction. It trades about -0.13 of its potential returns per unit of risk. Xinjiang Communications Construction is currently generating about -0.45 per unit of risk. If you would invest 469.00 in Beijing Sanyuan Foods on October 11, 2024 and sell it today you would lose (54.00) from holding Beijing Sanyuan Foods or give up 11.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Sanyuan Foods vs. Xinjiang Communications Constr
Performance |
| Timeline |
| Beijing Sanyuan Foods |
| Xinjiang Communications |
Beijing Sanyuan and Xinjiang Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Sanyuan and Xinjiang Communications
The main advantage of trading using opposite Beijing Sanyuan and Xinjiang Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Sanyuan position performs unexpectedly, Xinjiang Communications 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 Xinjiang Communications will offset losses from the drop in Xinjiang Communications' long position.| Beijing Sanyuan vs. Jinlong Machinery Electronic | Beijing Sanyuan vs. Sunny Loan Top | Beijing Sanyuan vs. Hainan Airlines Co | Beijing Sanyuan vs. Easyhome New Retail |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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