Correlation Between Suzhou Xingye and Hubei Xingfa
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By analyzing existing cross correlation between Suzhou Xingye Material and Hubei Xingfa Chemicals, you can compare the effects of market volatilities on Suzhou Xingye and Hubei Xingfa 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 Suzhou Xingye with a short position of Hubei Xingfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suzhou Xingye and Hubei Xingfa.
Diversification Opportunities for Suzhou Xingye and Hubei Xingfa
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Suzhou and Hubei is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Suzhou Xingye Material and Hubei Xingfa Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Xingfa Chemicals and Suzhou Xingye 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 Suzhou Xingye Material are associated (or correlated) with Hubei Xingfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Xingfa Chemicals has no effect on the direction of Suzhou Xingye i.e., Suzhou Xingye and Hubei Xingfa go up and down completely randomly.
Pair Corralation between Suzhou Xingye and Hubei Xingfa
Assuming the 90 days trading horizon Suzhou Xingye Material is expected to generate 1.24 times more return on investment than Hubei Xingfa. However, Suzhou Xingye is 1.24 times more volatile than Hubei Xingfa Chemicals. It trades about 0.21 of its potential returns per unit of risk. Hubei Xingfa Chemicals is currently generating about 0.03 per unit of risk. If you would invest 792.00 in Suzhou Xingye Material on September 13, 2024 and sell it today you would earn a total of 201.00 from holding Suzhou Xingye Material or generate 25.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Suzhou Xingye Material vs. Hubei Xingfa Chemicals
Performance |
| Timeline |
| Suzhou Xingye Material |
| Hubei Xingfa Chemicals |
Suzhou Xingye and Hubei Xingfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suzhou Xingye and Hubei Xingfa
The main advantage of trading using opposite Suzhou Xingye and Hubei Xingfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suzhou Xingye position performs unexpectedly, Hubei Xingfa 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 Hubei Xingfa will offset losses from the drop in Hubei Xingfa's long position.| Suzhou Xingye vs. Zijin Mining Group | Suzhou Xingye vs. Wanhua Chemical Group | Suzhou Xingye vs. Baoshan Iron Steel | Suzhou Xingye vs. Shandong Gold Mining |
| Hubei Xingfa vs. Ningbo Tip Rubber | Hubei Xingfa vs. Suzhou Xingye Material | Hubei Xingfa vs. Maccura Biotechnology Co | Hubei Xingfa vs. Sinosteel Luonai Materials |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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