Correlation Between Xilinmen Furniture and DO Home
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By analyzing existing cross correlation between Xilinmen Furniture Co and DO Home Collection, you can compare the effects of market volatilities on Xilinmen Furniture and DO Home 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 Xilinmen Furniture with a short position of DO Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xilinmen Furniture and DO Home.
Diversification Opportunities for Xilinmen Furniture and DO Home
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xilinmen and 002798 is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Xilinmen Furniture Co and DO Home Collection in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DO Home Collection and Xilinmen Furniture 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 Xilinmen Furniture Co are associated (or correlated) with DO Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DO Home Collection has no effect on the direction of Xilinmen Furniture i.e., Xilinmen Furniture and DO Home go up and down completely randomly.
Pair Corralation between Xilinmen Furniture and DO Home
Assuming the 90 days trading horizon Xilinmen Furniture Co is expected to generate 0.76 times more return on investment than DO Home. However, Xilinmen Furniture Co is 1.31 times less risky than DO Home. It trades about -0.02 of its potential returns per unit of risk. DO Home Collection is currently generating about -0.02 per unit of risk. If you would invest 2,415 in Xilinmen Furniture Co on September 1, 2024 and sell it today you would lose (520.00) from holding Xilinmen Furniture Co or give up 21.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xilinmen Furniture Co vs. DO Home Collection
Performance |
| Timeline |
| Xilinmen Furniture |
| DO Home Collection |
Xilinmen Furniture and DO Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xilinmen Furniture and DO Home
The main advantage of trading using opposite Xilinmen Furniture and DO Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xilinmen Furniture position performs unexpectedly, DO Home 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 DO Home will offset losses from the drop in DO Home's long position.| Xilinmen Furniture vs. Shenyang Chemical Industry | Xilinmen Furniture vs. Yangmei Chemical Co | Xilinmen Furniture vs. Ye Chiu Metal | Xilinmen Furniture vs. Maoming Petro Chemical Shihua |
| DO Home vs. Sinocat Environmental Technology | DO Home vs. Beijing SPC Environment | DO Home vs. Yankershop Food Co | DO Home vs. Anji Foodstuff 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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