Correlation Between Western Mining and Xiamen Bank
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By analyzing existing cross correlation between Western Mining Co and Xiamen Bank Co, you can compare the effects of market volatilities on Western Mining and Xiamen Bank 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 Western Mining with a short position of Xiamen Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Mining and Xiamen Bank.
Diversification Opportunities for Western Mining and Xiamen Bank
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Western and Xiamen is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Western Mining Co and Xiamen Bank Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Bank and Western Mining 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 Western Mining Co are associated (or correlated) with Xiamen Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Bank has no effect on the direction of Western Mining i.e., Western Mining and Xiamen Bank go up and down completely randomly.
Pair Corralation between Western Mining and Xiamen Bank
Assuming the 90 days trading horizon Western Mining Co is expected to generate 0.84 times more return on investment than Xiamen Bank. However, Western Mining Co is 1.2 times less risky than Xiamen Bank. It trades about 0.0 of its potential returns per unit of risk. Xiamen Bank Co is currently generating about -0.01 per unit of risk. If you would invest 1,733 in Western Mining Co on October 16, 2024 and sell it today you would lose (13.00) from holding Western Mining Co or give up 0.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Mining Co vs. Xiamen Bank Co
Performance |
| Timeline |
| Western Mining |
| Xiamen Bank |
Western Mining and Xiamen Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Mining and Xiamen Bank
The main advantage of trading using opposite Western Mining and Xiamen Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Mining position performs unexpectedly, Xiamen Bank 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 Xiamen Bank will offset losses from the drop in Xiamen Bank's long position.| Western Mining vs. Dosilicon Co | Western Mining vs. Longxing Chemical Stock | Western Mining vs. Mengtian Home Group | Western Mining vs. Shandong Rike Chemical |
| Xiamen Bank vs. Pengxin International Mining | Xiamen Bank vs. Ye Chiu Metal | Xiamen Bank vs. MayAir Technology Co | Xiamen Bank vs. Do Fluoride Chemicals Co |
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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