Correlation Between Shaanxi Construction and XJ Electric
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By analyzing existing cross correlation between Shaanxi Construction Machinery and XJ Electric Co, you can compare the effects of market volatilities on Shaanxi Construction and XJ Electric 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 Shaanxi Construction with a short position of XJ Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaanxi Construction and XJ Electric.
Diversification Opportunities for Shaanxi Construction and XJ Electric
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Shaanxi and 000400 is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Shaanxi Construction Machinery and XJ Electric Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XJ Electric and Shaanxi Construction 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 Shaanxi Construction Machinery are associated (or correlated) with XJ Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XJ Electric has no effect on the direction of Shaanxi Construction i.e., Shaanxi Construction and XJ Electric go up and down completely randomly.
Pair Corralation between Shaanxi Construction and XJ Electric
Assuming the 90 days trading horizon Shaanxi Construction Machinery is expected to under-perform the XJ Electric. In addition to that, Shaanxi Construction is 1.33 times more volatile than XJ Electric Co. It trades about -0.02 of its total potential returns per unit of risk. XJ Electric Co is currently generating about 0.04 per unit of volatility. If you would invest 1,922 in XJ Electric Co on September 3, 2024 and sell it today you would earn a total of 658.00 from holding XJ Electric Co or generate 34.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shaanxi Construction Machinery vs. XJ Electric Co
Performance |
| Timeline |
| Shaanxi Construction |
| XJ Electric |
Shaanxi Construction and XJ Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shaanxi Construction and XJ Electric
The main advantage of trading using opposite Shaanxi Construction and XJ Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaanxi Construction position performs unexpectedly, XJ Electric 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 XJ Electric will offset losses from the drop in XJ Electric's long position.| Shaanxi Construction vs. Cultural Investment Holdings | Shaanxi Construction vs. Gome Telecom Equipment | Shaanxi Construction vs. Bus Online Co | Shaanxi Construction vs. Holitech Technology Co |
| XJ Electric vs. Heilongjiang Transport Development | XJ Electric vs. Tengda Construction Group | XJ Electric vs. Anhui Huilong Agricultural | XJ Electric vs. Zhejiang Yayi Metal |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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