Correlation Between WuXi Xinje and Gansu Huangtai
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By analyzing existing cross correlation between WuXi Xinje Electric and Gansu Huangtai Wine marketing, you can compare the effects of market volatilities on WuXi Xinje and Gansu Huangtai 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 WuXi Xinje with a short position of Gansu Huangtai. Check out your portfolio center. Please also check ongoing floating volatility patterns of WuXi Xinje and Gansu Huangtai.
Diversification Opportunities for WuXi Xinje and Gansu Huangtai
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between WuXi and Gansu is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding WuXi Xinje Electric and Gansu Huangtai Wine marketing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Huangtai Wine and WuXi Xinje 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 WuXi Xinje Electric are associated (or correlated) with Gansu Huangtai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Huangtai Wine has no effect on the direction of WuXi Xinje i.e., WuXi Xinje and Gansu Huangtai go up and down completely randomly.
Pair Corralation between WuXi Xinje and Gansu Huangtai
Assuming the 90 days trading horizon WuXi Xinje Electric is expected to generate 0.67 times more return on investment than Gansu Huangtai. However, WuXi Xinje Electric is 1.48 times less risky than Gansu Huangtai. It trades about 0.25 of its potential returns per unit of risk. Gansu Huangtai Wine marketing is currently generating about 0.04 per unit of risk. If you would invest 3,504 in WuXi Xinje Electric on September 27, 2024 and sell it today you would earn a total of 584.00 from holding WuXi Xinje Electric or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
WuXi Xinje Electric vs. Gansu Huangtai Wine marketing
Performance |
| Timeline |
| WuXi Xinje Electric |
| Gansu Huangtai Wine |
WuXi Xinje and Gansu Huangtai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WuXi Xinje and Gansu Huangtai
The main advantage of trading using opposite WuXi Xinje and Gansu Huangtai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WuXi Xinje position performs unexpectedly, Gansu Huangtai 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 Gansu Huangtai will offset losses from the drop in Gansu Huangtai's long position.| WuXi Xinje vs. Industrial and Commercial | WuXi Xinje vs. China Construction Bank | WuXi Xinje vs. Agricultural Bank of | WuXi Xinje vs. Bank of China |
| Gansu Huangtai vs. Jiangsu Phoenix Publishing | Gansu Huangtai vs. Wangneng Environment Co | Gansu Huangtai vs. Dynagreen Environmental Protection | Gansu Huangtai vs. Chinese Universe Publishing |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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