Correlation Between Xinjiang Baodi and Xinjiang Zhongtai
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By analyzing existing cross correlation between Xinjiang Baodi Mining and Xinjiang Zhongtai Chemical, you can compare the effects of market volatilities on Xinjiang Baodi and Xinjiang Zhongtai 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 Xinjiang Zhongtai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Baodi and Xinjiang Zhongtai.
Diversification Opportunities for Xinjiang Baodi and Xinjiang Zhongtai
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xinjiang and Xinjiang is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Baodi Mining and Xinjiang Zhongtai Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Zhongtai 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 Xinjiang Zhongtai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Zhongtai has no effect on the direction of Xinjiang Baodi i.e., Xinjiang Baodi and Xinjiang Zhongtai go up and down completely randomly.
Pair Corralation between Xinjiang Baodi and Xinjiang Zhongtai
Assuming the 90 days trading horizon Xinjiang Baodi is expected to generate 1.12 times less return on investment than Xinjiang Zhongtai. In addition to that, Xinjiang Baodi is 1.3 times more volatile than Xinjiang Zhongtai Chemical. It trades about 0.18 of its total potential returns per unit of risk. Xinjiang Zhongtai Chemical is currently generating about 0.26 per unit of volatility. If you would invest 342.00 in Xinjiang Zhongtai Chemical on September 12, 2024 and sell it today you would earn a total of 120.00 from holding Xinjiang Zhongtai Chemical or generate 35.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Baodi Mining vs. Xinjiang Zhongtai Chemical
Performance |
| Timeline |
| Xinjiang Baodi Mining |
| Xinjiang Zhongtai |
Xinjiang Baodi and Xinjiang Zhongtai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Baodi and Xinjiang Zhongtai
The main advantage of trading using opposite Xinjiang Baodi and Xinjiang Zhongtai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Baodi position performs unexpectedly, Xinjiang Zhongtai 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 Xinjiang Zhongtai will offset losses from the drop in Xinjiang Zhongtai'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 |
| Xinjiang Zhongtai vs. Heilongjiang Transport Development | Xinjiang Zhongtai vs. Harbin Hatou Investment | Xinjiang Zhongtai vs. Kunwu Jiuding Investment | Xinjiang Zhongtai vs. Xinjiang Beixin RoadBridge |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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