Correlation Between Allied Machinery and Xiangyu Medical
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By analyzing existing cross correlation between Allied Machinery Co and Xiangyu Medical Co, you can compare the effects of market volatilities on Allied Machinery and Xiangyu Medical 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 Allied Machinery with a short position of Xiangyu Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allied Machinery and Xiangyu Medical.
Diversification Opportunities for Allied Machinery and Xiangyu Medical
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Allied and Xiangyu is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Allied Machinery Co and Xiangyu Medical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiangyu Medical and Allied 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 Allied Machinery Co are associated (or correlated) with Xiangyu Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiangyu Medical has no effect on the direction of Allied Machinery i.e., Allied Machinery and Xiangyu Medical go up and down completely randomly.
Pair Corralation between Allied Machinery and Xiangyu Medical
Assuming the 90 days trading horizon Allied Machinery Co is expected to under-perform the Xiangyu Medical. But the stock apears to be less risky and, when comparing its historical volatility, Allied Machinery Co is 1.51 times less risky than Xiangyu Medical. The stock trades about -0.09 of its potential returns per unit of risk. The Xiangyu Medical Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 3,149 in Xiangyu Medical Co on September 28, 2024 and sell it today you would lose (16.00) from holding Xiangyu Medical Co or give up 0.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allied Machinery Co vs. Xiangyu Medical Co
Performance |
| Timeline |
| Allied Machinery |
| Xiangyu Medical |
Allied Machinery and Xiangyu Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allied Machinery and Xiangyu Medical
The main advantage of trading using opposite Allied Machinery and Xiangyu Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allied Machinery position performs unexpectedly, Xiangyu Medical 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 Xiangyu Medical will offset losses from the drop in Xiangyu Medical's long position.| Allied Machinery vs. Bank of China | Allied Machinery vs. Kweichow Moutai Co | Allied Machinery vs. PetroChina Co Ltd | Allied Machinery vs. Bank of Communications |
| Xiangyu Medical vs. New China Life | Xiangyu Medical vs. Ming Yang Smart | Xiangyu Medical vs. 159681 | Xiangyu Medical vs. 159005 |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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