Correlation Between Xiamen Goldenhome and Citic Guoan
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By analyzing existing cross correlation between Xiamen Goldenhome Co and Citic Guoan Wine, you can compare the effects of market volatilities on Xiamen Goldenhome and Citic Guoan 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 Citic Guoan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen Goldenhome and Citic Guoan.
Diversification Opportunities for Xiamen Goldenhome and Citic Guoan
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xiamen and Citic is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen Goldenhome Co and Citic Guoan Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citic Guoan Wine 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 Citic Guoan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citic Guoan Wine has no effect on the direction of Xiamen Goldenhome i.e., Xiamen Goldenhome and Citic Guoan go up and down completely randomly.
Pair Corralation between Xiamen Goldenhome and Citic Guoan
Assuming the 90 days trading horizon Xiamen Goldenhome Co is expected to generate 0.79 times more return on investment than Citic Guoan. However, Xiamen Goldenhome Co is 1.26 times less risky than Citic Guoan. It trades about 0.21 of its potential returns per unit of risk. Citic Guoan Wine is currently generating about 0.16 per unit of risk. If you would invest 1,978 in Xiamen Goldenhome Co on September 3, 2024 and sell it today you would earn a total of 192.00 from holding Xiamen Goldenhome Co or generate 9.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen Goldenhome Co vs. Citic Guoan Wine
Performance |
| Timeline |
| Xiamen Goldenhome |
| Citic Guoan Wine |
Xiamen Goldenhome and Citic Guoan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen Goldenhome and Citic Guoan
The main advantage of trading using opposite Xiamen Goldenhome and Citic Guoan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen Goldenhome position performs unexpectedly, Citic Guoan 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 Citic Guoan will offset losses from the drop in Citic Guoan's long position.| Xiamen Goldenhome vs. PetroChina Co Ltd | Xiamen Goldenhome vs. China Mobile Limited | Xiamen Goldenhome vs. Industrial and Commercial | Xiamen Goldenhome vs. China Life Insurance |
| Citic Guoan vs. Luolai Home Textile | Citic Guoan vs. Shandong Homey Aquatic | Citic Guoan vs. Fiberhome Telecommunication Technologies | Citic Guoan vs. Xiamen Goldenhome 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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