Correlation Between Mengtian Home and Xiamen Goldenhome
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By analyzing existing cross correlation between Mengtian Home Group and Xiamen Goldenhome Co, you can compare the effects of market volatilities on Mengtian Home and Xiamen Goldenhome 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 Mengtian Home with a short position of Xiamen Goldenhome. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mengtian Home and Xiamen Goldenhome.
Diversification Opportunities for Mengtian Home and Xiamen Goldenhome
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mengtian and Xiamen is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Mengtian Home Group and Xiamen Goldenhome Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Goldenhome and Mengtian Home 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 Mengtian Home Group are associated (or correlated) with Xiamen Goldenhome. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Goldenhome has no effect on the direction of Mengtian Home i.e., Mengtian Home and Xiamen Goldenhome go up and down completely randomly.
Pair Corralation between Mengtian Home and Xiamen Goldenhome
Assuming the 90 days trading horizon Mengtian Home Group is expected to generate 1.13 times more return on investment than Xiamen Goldenhome. However, Mengtian Home is 1.13 times more volatile than Xiamen Goldenhome Co. It trades about -0.01 of its potential returns per unit of risk. Xiamen Goldenhome Co is currently generating about -0.02 per unit of risk. If you would invest 1,273 in Mengtian Home Group on September 1, 2024 and sell it today you would lose (178.00) from holding Mengtian Home Group or give up 13.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mengtian Home Group vs. Xiamen Goldenhome Co
Performance |
| Timeline |
| Mengtian Home Group |
| Xiamen Goldenhome |
Mengtian Home and Xiamen Goldenhome Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mengtian Home and Xiamen Goldenhome
The main advantage of trading using opposite Mengtian Home and Xiamen Goldenhome positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mengtian Home position performs unexpectedly, Xiamen Goldenhome 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 Xiamen Goldenhome will offset losses from the drop in Xiamen Goldenhome's long position.| Mengtian Home vs. China Publishing Media | Mengtian Home vs. Time Publishing and | Mengtian Home vs. Yingde Greatchem Chemicals | Mengtian Home vs. Focus Media Information |
| Xiamen Goldenhome vs. China Asset Management | Xiamen Goldenhome vs. Chison Medical Technologies | Xiamen Goldenhome vs. CICC Fund Management | Xiamen Goldenhome vs. GKHT Medical Technology |
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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