Correlation Between Inspur Software and Hubei Xingfa
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By analyzing existing cross correlation between Inspur Software Co and Hubei Xingfa Chemicals, you can compare the effects of market volatilities on Inspur Software and Hubei Xingfa 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 Inspur Software with a short position of Hubei Xingfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inspur Software and Hubei Xingfa.
Diversification Opportunities for Inspur Software and Hubei Xingfa
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Inspur and Hubei is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Inspur Software Co and Hubei Xingfa Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Xingfa Chemicals and Inspur Software 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 Inspur Software Co are associated (or correlated) with Hubei Xingfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Xingfa Chemicals has no effect on the direction of Inspur Software i.e., Inspur Software and Hubei Xingfa go up and down completely randomly.
Pair Corralation between Inspur Software and Hubei Xingfa
Assuming the 90 days trading horizon Inspur Software Co is expected to under-perform the Hubei Xingfa. In addition to that, Inspur Software is 2.37 times more volatile than Hubei Xingfa Chemicals. It trades about -0.2 of its total potential returns per unit of risk. Hubei Xingfa Chemicals is currently generating about -0.22 per unit of volatility. If you would invest 2,236 in Hubei Xingfa Chemicals on October 17, 2024 and sell it today you would lose (123.00) from holding Hubei Xingfa Chemicals or give up 5.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inspur Software Co vs. Hubei Xingfa Chemicals
Performance |
| Timeline |
| Inspur Software |
| Hubei Xingfa Chemicals |
Inspur Software and Hubei Xingfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inspur Software and Hubei Xingfa
The main advantage of trading using opposite Inspur Software and Hubei Xingfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inspur Software position performs unexpectedly, Hubei Xingfa 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 Hubei Xingfa will offset losses from the drop in Hubei Xingfa's long position.| Inspur Software vs. Zhengzhou Coal Mining | Inspur Software vs. Shenzhen Topway Video | Inspur Software vs. Ningbo Fangzheng Automobile | Inspur Software vs. Chenzhou Jingui Silver |
| Hubei Xingfa vs. Luyin Investment Group | Hubei Xingfa vs. Chengdu Xingrong Investment | Hubei Xingfa vs. Xiandai Investment Co | Hubei Xingfa vs. Fujian Longzhou Transportation |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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