Correlation Between Xiamen Goldenhome and Xinxiang Chemical
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By analyzing existing cross correlation between Xiamen Goldenhome Co and Xinxiang Chemical Fiber, you can compare the effects of market volatilities on Xiamen Goldenhome and Xinxiang 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 Goldenhome with a short position of Xinxiang Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen Goldenhome and Xinxiang Chemical.
Diversification Opportunities for Xiamen Goldenhome and Xinxiang Chemical
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xiamen and Xinxiang is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen Goldenhome Co and Xinxiang Chemical Fiber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinxiang Chemical Fiber and Xiamen Goldenhome 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 Goldenhome Co are associated (or correlated) with Xinxiang Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinxiang Chemical Fiber has no effect on the direction of Xiamen Goldenhome i.e., Xiamen Goldenhome and Xinxiang Chemical go up and down completely randomly.
Pair Corralation between Xiamen Goldenhome and Xinxiang Chemical
Assuming the 90 days trading horizon Xiamen Goldenhome Co is expected to under-perform the Xinxiang Chemical. But the stock apears to be less risky and, when comparing its historical volatility, Xiamen Goldenhome Co is 1.49 times less risky than Xinxiang Chemical. The stock trades about -0.03 of its potential returns per unit of risk. The Xinxiang Chemical Fiber is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 320.00 in Xinxiang Chemical Fiber on October 16, 2024 and sell it today you would earn a total of 80.00 from holding Xinxiang Chemical Fiber or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen Goldenhome Co vs. Xinxiang Chemical Fiber
Performance |
| Timeline |
| Xiamen Goldenhome |
| Xinxiang Chemical Fiber |
Xiamen Goldenhome and Xinxiang Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen Goldenhome and Xinxiang Chemical
The main advantage of trading using opposite Xiamen Goldenhome and Xinxiang Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen Goldenhome position performs unexpectedly, Xinxiang 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 Xinxiang Chemical will offset losses from the drop in Xinxiang Chemical's long position.| Xiamen Goldenhome vs. Gan Yuan Foods | Xiamen Goldenhome vs. Shandong Polymer Biochemicals | Xiamen Goldenhome vs. Lander Sports Development | Xiamen Goldenhome vs. Ningxia Younglight Chemicals |
| Xinxiang Chemical vs. Anji Foodstuff Co | Xinxiang Chemical vs. Nexchip Semiconductor Corp | Xinxiang Chemical vs. JuneYao Dairy Co | Xinxiang Chemical vs. Guangdong Marubi Biotechnology |
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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