Correlation Between Xinjiang Baodi and Hainan Airlines
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By analyzing existing cross correlation between Xinjiang Baodi Mining and Hainan Airlines Co, you can compare the effects of market volatilities on Xinjiang Baodi and Hainan Airlines 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 Hainan Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Baodi and Hainan Airlines.
Diversification Opportunities for Xinjiang Baodi and Hainan Airlines
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xinjiang and Hainan is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Baodi Mining and Hainan Airlines Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hainan Airlines 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 Hainan Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hainan Airlines has no effect on the direction of Xinjiang Baodi i.e., Xinjiang Baodi and Hainan Airlines go up and down completely randomly.
Pair Corralation between Xinjiang Baodi and Hainan Airlines
Assuming the 90 days trading horizon Xinjiang Baodi Mining is expected to under-perform the Hainan Airlines. In addition to that, Xinjiang Baodi is 1.07 times more volatile than Hainan Airlines Co. It trades about -0.02 of its total potential returns per unit of risk. Hainan Airlines Co is currently generating about 0.01 per unit of volatility. If you would invest 169.00 in Hainan Airlines Co on August 29, 2024 and sell it today you would lose (2.00) from holding Hainan Airlines Co or give up 1.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Baodi Mining vs. Hainan Airlines Co
Performance |
| Timeline |
| Xinjiang Baodi Mining |
| Hainan Airlines |
Xinjiang Baodi and Hainan Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Baodi and Hainan Airlines
The main advantage of trading using opposite Xinjiang Baodi and Hainan Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Baodi position performs unexpectedly, Hainan Airlines 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 Hainan Airlines will offset losses from the drop in Hainan Airlines' 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 |
| Hainan Airlines vs. BYD Co Ltd | Hainan Airlines vs. China Mobile Limited | Hainan Airlines vs. Agricultural Bank of | Hainan Airlines vs. Industrial and Commercial |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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