Correlation Between Xiamen ITG and China National
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By analyzing existing cross correlation between Xiamen ITG Group and China National Software, you can compare the effects of market volatilities on Xiamen ITG and China National 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 ITG with a short position of China National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen ITG and China National.
Diversification Opportunities for Xiamen ITG and China National
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xiamen and China is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen ITG Group and China National Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China National Software and Xiamen ITG 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 ITG Group are associated (or correlated) with China National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China National Software has no effect on the direction of Xiamen ITG i.e., Xiamen ITG and China National go up and down completely randomly.
Pair Corralation between Xiamen ITG and China National
Assuming the 90 days trading horizon Xiamen ITG is expected to generate 3.79 times less return on investment than China National. But when comparing it to its historical volatility, Xiamen ITG Group is 1.75 times less risky than China National. It trades about 0.11 of its potential returns per unit of risk. China National Software is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 3,084 in China National Software on September 3, 2024 and sell it today you would earn a total of 2,462 from holding China National Software or generate 79.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen ITG Group vs. China National Software
Performance |
| Timeline |
| Xiamen ITG Group |
| China National Software |
Xiamen ITG and China National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen ITG and China National
The main advantage of trading using opposite Xiamen ITG and China National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen ITG position performs unexpectedly, China National 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 China National will offset losses from the drop in China National's long position.| Xiamen ITG vs. Industrial Bank Co | Xiamen ITG vs. Panda Financial Holding | Xiamen ITG vs. Dongguan Tarry Electronics | Xiamen ITG vs. GRG Banking Equipment |
| China National vs. Shandong Hi Speed RoadBridge | China National vs. Huatian Hotel Group | China National vs. Jiangsu Broadcasting Cable | China National vs. Glodon Software Co |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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