Correlation Between Xiamen Bank and HeBei Jinniu
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By analyzing existing cross correlation between Xiamen Bank Co and HeBei Jinniu Chemical, you can compare the effects of market volatilities on Xiamen Bank and HeBei Jinniu 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 HeBei Jinniu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen Bank and HeBei Jinniu.
Diversification Opportunities for Xiamen Bank and HeBei Jinniu
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xiamen and HeBei is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen Bank Co and HeBei Jinniu Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HeBei Jinniu Chemical 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 HeBei Jinniu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HeBei Jinniu Chemical has no effect on the direction of Xiamen Bank i.e., Xiamen Bank and HeBei Jinniu go up and down completely randomly.
Pair Corralation between Xiamen Bank and HeBei Jinniu
Assuming the 90 days trading horizon Xiamen Bank Co is expected to under-perform the HeBei Jinniu. But the stock apears to be less risky and, when comparing its historical volatility, Xiamen Bank Co is 2.44 times less risky than HeBei Jinniu. The stock trades about -0.16 of its potential returns per unit of risk. The HeBei Jinniu Chemical is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 528.00 in HeBei Jinniu Chemical on October 19, 2024 and sell it today you would earn a total of 38.00 from holding HeBei Jinniu Chemical or generate 7.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen Bank Co vs. HeBei Jinniu Chemical
Performance |
| Timeline |
| Xiamen Bank |
| HeBei Jinniu Chemical |
Xiamen Bank and HeBei Jinniu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen Bank and HeBei Jinniu
The main advantage of trading using opposite Xiamen Bank and HeBei Jinniu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen Bank position performs unexpectedly, HeBei Jinniu 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 HeBei Jinniu will offset losses from the drop in HeBei Jinniu's long position.| Xiamen Bank vs. Allgens Medical Technology | Xiamen Bank vs. Xiangyu Medical Co | Xiamen Bank vs. Cowealth Medical China | Xiamen Bank vs. Zhongzhu Medical Holdings |
| HeBei Jinniu vs. China Everbright Bank | HeBei Jinniu vs. Hubei Xingfa Chemicals | HeBei Jinniu vs. Unisplendour Corp | HeBei Jinniu vs. Xiamen Bank 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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