Correlation Between Xinjiang Baodi and Shenyang Huitian
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By analyzing existing cross correlation between Xinjiang Baodi Mining and Shenyang Huitian Thermal, you can compare the effects of market volatilities on Xinjiang Baodi and Shenyang Huitian 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 Shenyang Huitian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Baodi and Shenyang Huitian.
Diversification Opportunities for Xinjiang Baodi and Shenyang Huitian
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xinjiang and Shenyang is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Baodi Mining and Shenyang Huitian Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenyang Huitian Thermal 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 Shenyang Huitian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenyang Huitian Thermal has no effect on the direction of Xinjiang Baodi i.e., Xinjiang Baodi and Shenyang Huitian go up and down completely randomly.
Pair Corralation between Xinjiang Baodi and Shenyang Huitian
Assuming the 90 days trading horizon Xinjiang Baodi Mining is expected to generate 0.7 times more return on investment than Shenyang Huitian. However, Xinjiang Baodi Mining is 1.44 times less risky than Shenyang Huitian. It trades about 0.12 of its potential returns per unit of risk. Shenyang Huitian Thermal is currently generating about -0.02 per unit of risk. If you would invest 616.00 in Xinjiang Baodi Mining on August 30, 2024 and sell it today you would earn a total of 42.00 from holding Xinjiang Baodi Mining or generate 6.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Baodi Mining vs. Shenyang Huitian Thermal
Performance |
| Timeline |
| Xinjiang Baodi Mining |
| Shenyang Huitian Thermal |
Xinjiang Baodi and Shenyang Huitian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Baodi and Shenyang Huitian
The main advantage of trading using opposite Xinjiang Baodi and Shenyang Huitian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Baodi position performs unexpectedly, Shenyang Huitian 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 Shenyang Huitian will offset losses from the drop in Shenyang Huitian's long position.| Xinjiang Baodi vs. Zijin Mining Group | Xinjiang Baodi vs. Wanhua Chemical Group | Xinjiang Baodi vs. Baoshan Iron Steel | Xinjiang Baodi vs. Shandong Gold Mining |
| Shenyang Huitian vs. Ming Yang Smart | Shenyang Huitian vs. 159005 | Shenyang Huitian vs. Loctek Ergonomic Technology | Shenyang Huitian vs. 516220 |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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