Correlation Between Xiamen Bank and Lianhe Chemical
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By analyzing existing cross correlation between Xiamen Bank Co and Lianhe Chemical Technology, you can compare the effects of market volatilities on Xiamen Bank and Lianhe Chemical 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 Xiamen Bank with a short position of Lianhe Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen Bank and Lianhe Chemical.
Diversification Opportunities for Xiamen Bank and Lianhe Chemical
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Xiamen and Lianhe is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen Bank Co and Lianhe Chemical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lianhe Chemical Tech and Xiamen Bank 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 Xiamen Bank Co are associated (or correlated) with Lianhe Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lianhe Chemical Tech has no effect on the direction of Xiamen Bank i.e., Xiamen Bank and Lianhe Chemical go up and down completely randomly.
Pair Corralation between Xiamen Bank and Lianhe Chemical
Assuming the 90 days trading horizon Xiamen Bank Co is expected to generate 0.59 times more return on investment than Lianhe Chemical. However, Xiamen Bank Co is 1.7 times less risky than Lianhe Chemical. It trades about 0.02 of its potential returns per unit of risk. Lianhe Chemical Technology is currently generating about -0.08 per unit of risk. If you would invest 499.00 in Xiamen Bank Co on November 1, 2024 and sell it today you would earn a total of 56.00 from holding Xiamen Bank Co or generate 11.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen Bank Co vs. Lianhe Chemical Technology
Performance |
| Timeline |
| Xiamen Bank |
| Lianhe Chemical Tech |
Xiamen Bank and Lianhe Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen Bank and Lianhe Chemical
The main advantage of trading using opposite Xiamen Bank and Lianhe Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen Bank position performs unexpectedly, Lianhe Chemical 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 Lianhe Chemical will offset losses from the drop in Lianhe Chemical's long position.| Xiamen Bank vs. Lianhe Chemical Technology | Xiamen Bank vs. Shandong Sanyuan Biotechnology | Xiamen Bank vs. Lier Chemical Co | Xiamen Bank vs. Guangdong Marubi Biotechnology |
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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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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