Correlation Between Great Sun and Xinxiang Chemical
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By analyzing existing cross correlation between Great Sun Foods Co and Xinxiang Chemical Fiber, you can compare the effects of market volatilities on Great Sun 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 Great Sun with a short position of Xinxiang Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great Sun and Xinxiang Chemical.
Diversification Opportunities for Great Sun and Xinxiang Chemical
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Great and Xinxiang is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Great Sun Foods 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 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 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 Great Sun i.e., Great Sun and Xinxiang Chemical go up and down completely randomly.
Pair Corralation between Great Sun and Xinxiang Chemical
Assuming the 90 days trading horizon Great Sun is expected to generate 1.91 times less return on investment than Xinxiang Chemical. But when comparing it to its historical volatility, Great Sun Foods Co is 2.07 times less risky than Xinxiang Chemical. It trades about 0.22 of its potential returns per unit of risk. Xinxiang Chemical Fiber is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 374.00 in Xinxiang Chemical Fiber on September 16, 2024 and sell it today you would earn a total of 80.00 from holding Xinxiang Chemical Fiber or generate 21.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Great Sun Foods Co vs. Xinxiang Chemical Fiber
Performance |
| Timeline |
| Great Sun Foods |
| Xinxiang Chemical Fiber |
Great Sun and Xinxiang Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great Sun and Xinxiang Chemical
The main advantage of trading using opposite Great Sun and Xinxiang Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great Sun 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.| Great Sun vs. Peoples Insurance of | Great Sun vs. Guangxi Wuzhou Communications | Great Sun vs. Tsingtao Brewery Co | Great Sun vs. Jilin Jlu Communication |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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