Correlation Between Great Sun and Xiwang Foodstuffs
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By analyzing existing cross correlation between Great Sun Foods Co and Xiwang Foodstuffs Co, you can compare the effects of market volatilities on Great Sun 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 Great Sun with a short position of Xiwang Foodstuffs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great Sun and Xiwang Foodstuffs.
Diversification Opportunities for Great Sun and Xiwang Foodstuffs
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Great and Xiwang is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Great Sun Foods Co and Xiwang Foodstuffs Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiwang Foodstuffs and Great Sun 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 Great Sun Foods Co 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 Great Sun i.e., Great Sun and Xiwang Foodstuffs go up and down completely randomly.
Pair Corralation between Great Sun and Xiwang Foodstuffs
Assuming the 90 days trading horizon Great Sun is expected to generate 4.24 times less return on investment than Xiwang Foodstuffs. But when comparing it to its historical volatility, Great Sun Foods Co is 1.44 times less risky than Xiwang Foodstuffs. It trades about 0.05 of its potential returns per unit of risk. Xiwang Foodstuffs Co is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 351.00 in Xiwang Foodstuffs Co on September 3, 2024 and sell it today you would earn a total of 64.00 from holding Xiwang Foodstuffs Co or generate 18.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Great Sun Foods Co vs. Xiwang Foodstuffs Co
Performance |
| Timeline |
| Great Sun Foods |
| Xiwang Foodstuffs |
Great Sun and Xiwang Foodstuffs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great Sun and Xiwang Foodstuffs
The main advantage of trading using opposite Great Sun and Xiwang Foodstuffs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great Sun 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.| Great Sun vs. Beijing Wantai Biological | Great Sun vs. Aluminum Corp of | Great Sun vs. COL Digital Publishing | Great Sun vs. Shaanxi Meineng Clean |
| Xiwang Foodstuffs vs. Beijing Wantai Biological | Xiwang Foodstuffs vs. Aluminum Corp of | Xiwang Foodstuffs vs. COL Digital Publishing | Xiwang Foodstuffs vs. Shaanxi Meineng Clean |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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