Correlation Between Xinya Electronic and Guangzhou Fangbang
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By analyzing existing cross correlation between Xinya Electronic Co and Guangzhou Fangbang Electronics, you can compare the effects of market volatilities on Xinya Electronic and Guangzhou Fangbang 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 Xinya Electronic with a short position of Guangzhou Fangbang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinya Electronic and Guangzhou Fangbang.
Diversification Opportunities for Xinya Electronic and Guangzhou Fangbang
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xinya and Guangzhou is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Xinya Electronic Co and Guangzhou Fangbang Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Fangbang and Xinya Electronic 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 Xinya Electronic Co are associated (or correlated) with Guangzhou Fangbang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Fangbang has no effect on the direction of Xinya Electronic i.e., Xinya Electronic and Guangzhou Fangbang go up and down completely randomly.
Pair Corralation between Xinya Electronic and Guangzhou Fangbang
Assuming the 90 days trading horizon Xinya Electronic Co is expected to generate 1.24 times more return on investment than Guangzhou Fangbang. However, Xinya Electronic is 1.24 times more volatile than Guangzhou Fangbang Electronics. It trades about 0.33 of its potential returns per unit of risk. Guangzhou Fangbang Electronics is currently generating about 0.02 per unit of risk. If you would invest 1,324 in Xinya Electronic Co on September 27, 2024 and sell it today you would earn a total of 253.00 from holding Xinya Electronic Co or generate 19.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinya Electronic Co vs. Guangzhou Fangbang Electronics
Performance |
| Timeline |
| Xinya Electronic |
| Guangzhou Fangbang |
Xinya Electronic and Guangzhou Fangbang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinya Electronic and Guangzhou Fangbang
The main advantage of trading using opposite Xinya Electronic and Guangzhou Fangbang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinya Electronic position performs unexpectedly, Guangzhou Fangbang 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 Guangzhou Fangbang will offset losses from the drop in Guangzhou Fangbang's long position.| Xinya Electronic vs. Shengtak New Material | Xinya Electronic vs. Ningxia Building Materials | Xinya Electronic vs. Jiugui Liquor Co | Xinya Electronic vs. Shenzhen SDG Information |
| Guangzhou Fangbang vs. Industrial and Commercial | Guangzhou Fangbang vs. China Construction Bank | Guangzhou Fangbang vs. Agricultural Bank of | Guangzhou Fangbang vs. Bank of China |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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