Correlation Between Qijing Machinery and Shanxi Xishan
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By analyzing existing cross correlation between Qijing Machinery and Shanxi Xishan Coal, you can compare the effects of market volatilities on Qijing Machinery and Shanxi Xishan 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 Qijing Machinery with a short position of Shanxi Xishan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qijing Machinery and Shanxi Xishan.
Diversification Opportunities for Qijing Machinery and Shanxi Xishan
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Qijing and Shanxi is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Qijing Machinery and Shanxi Xishan Coal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanxi Xishan Coal and Qijing Machinery 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 Qijing Machinery are associated (or correlated) with Shanxi Xishan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanxi Xishan Coal has no effect on the direction of Qijing Machinery i.e., Qijing Machinery and Shanxi Xishan go up and down completely randomly.
Pair Corralation between Qijing Machinery and Shanxi Xishan
Assuming the 90 days trading horizon Qijing Machinery is expected to generate 9.65 times less return on investment than Shanxi Xishan. In addition to that, Qijing Machinery is 1.37 times more volatile than Shanxi Xishan Coal. It trades about 0.0 of its total potential returns per unit of risk. Shanxi Xishan Coal is currently generating about 0.02 per unit of volatility. If you would invest 791.00 in Shanxi Xishan Coal on September 1, 2024 and sell it today you would earn a total of 23.00 from holding Shanxi Xishan Coal or generate 2.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.62% |
| Values | Daily Returns |
Qijing Machinery vs. Shanxi Xishan Coal
Performance |
| Timeline |
| Qijing Machinery |
| Shanxi Xishan Coal |
Qijing Machinery and Shanxi Xishan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qijing Machinery and Shanxi Xishan
The main advantage of trading using opposite Qijing Machinery and Shanxi Xishan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qijing Machinery position performs unexpectedly, Shanxi Xishan 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 Shanxi Xishan will offset losses from the drop in Shanxi Xishan's long position.| Qijing Machinery vs. Cultural Investment Holdings | Qijing Machinery vs. Gome Telecom Equipment | Qijing Machinery vs. Bus Online Co | Qijing Machinery vs. Zotye Automobile Co |
| Shanxi Xishan vs. Zhejiang Kingland Pipeline | Shanxi Xishan vs. Zhejiang Dahua Technology | Shanxi Xishan vs. Changchun Faway Automobile | Shanxi Xishan vs. Shanghai Lingyun Industries |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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