Correlation Between Xinjiang Baodi and Haima Automobile
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By analyzing existing cross correlation between Xinjiang Baodi Mining and Haima Automobile Group, you can compare the effects of market volatilities on Xinjiang Baodi and Haima Automobile 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 Baodi with a short position of Haima Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Baodi and Haima Automobile.
Diversification Opportunities for Xinjiang Baodi and Haima Automobile
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Xinjiang and Haima is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Baodi Mining and Haima Automobile Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haima Automobile and Xinjiang Baodi 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 Baodi Mining are associated (or correlated) with Haima Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haima Automobile has no effect on the direction of Xinjiang Baodi i.e., Xinjiang Baodi and Haima Automobile go up and down completely randomly.
Pair Corralation between Xinjiang Baodi and Haima Automobile
Assuming the 90 days trading horizon Xinjiang Baodi Mining is expected to under-perform the Haima Automobile. In addition to that, Xinjiang Baodi is 1.04 times more volatile than Haima Automobile Group. It trades about -0.19 of its total potential returns per unit of risk. Haima Automobile Group is currently generating about 0.07 per unit of volatility. If you would invest 391.00 in Haima Automobile Group on November 7, 2024 and sell it today you would earn a total of 9.00 from holding Haima Automobile Group or generate 2.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Baodi Mining vs. Haima Automobile Group
Performance |
| Timeline |
| Xinjiang Baodi Mining |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Haima Automobile |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Xinjiang Baodi and Haima Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Baodi and Haima Automobile
The main advantage of trading using opposite Xinjiang Baodi and Haima Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Baodi position performs unexpectedly, Haima Automobile 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 Haima Automobile will offset losses from the drop in Haima Automobile's long position.The idea behind Xinjiang Baodi Mining and Haima Automobile Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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