Correlation Between Northern United and Xiwang Foodstuffs
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By analyzing existing cross correlation between Northern United Publishing and Xiwang Foodstuffs Co, you can compare the effects of market volatilities on Northern United and Xiwang Foodstuffs 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 Northern United with a short position of Xiwang Foodstuffs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northern United and Xiwang Foodstuffs.
Diversification Opportunities for Northern United and Xiwang Foodstuffs
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Northern and Xiwang is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Northern United Publishing and Xiwang Foodstuffs Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiwang Foodstuffs and Northern United 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 Northern United Publishing are associated (or correlated) with Xiwang Foodstuffs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiwang Foodstuffs has no effect on the direction of Northern United i.e., Northern United and Xiwang Foodstuffs go up and down completely randomly.
Pair Corralation between Northern United and Xiwang Foodstuffs
Assuming the 90 days trading horizon Northern United Publishing is expected to generate 0.81 times more return on investment than Xiwang Foodstuffs. However, Northern United Publishing is 1.24 times less risky than Xiwang Foodstuffs. It trades about -0.01 of its potential returns per unit of risk. Xiwang Foodstuffs Co is currently generating about -0.01 per unit of risk. If you would invest 692.00 in Northern United Publishing on September 27, 2024 and sell it today you would lose (14.00) from holding Northern United Publishing or give up 2.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Northern United Publishing vs. Xiwang Foodstuffs Co
Performance |
| Timeline |
| Northern United Publ |
| Xiwang Foodstuffs |
Northern United and Xiwang Foodstuffs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northern United and Xiwang Foodstuffs
The main advantage of trading using opposite Northern United and Xiwang Foodstuffs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northern United position performs unexpectedly, Xiwang Foodstuffs 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 Xiwang Foodstuffs will offset losses from the drop in Xiwang Foodstuffs' long position.| Northern United vs. PetroChina Co Ltd | Northern United vs. China Mobile Limited | Northern United vs. CNOOC Limited | Northern United vs. Ping An Insurance |
| Xiwang Foodstuffs vs. Northern United Publishing | Xiwang Foodstuffs vs. Guangdong Jingyi Metal | Xiwang Foodstuffs vs. Jiangxi Selon Industrial | Xiwang Foodstuffs vs. Qingdao Choho Industrial |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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