Correlation Between Hi Trend and Xilinmen Furniture
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By analyzing existing cross correlation between Hi Trend TechCo and Xilinmen Furniture Co, you can compare the effects of market volatilities on Hi Trend and Xilinmen Furniture 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 Hi Trend with a short position of Xilinmen Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hi Trend and Xilinmen Furniture.
Diversification Opportunities for Hi Trend and Xilinmen Furniture
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 688391 and Xilinmen is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Hi Trend TechCo and Xilinmen Furniture Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xilinmen Furniture and Hi Trend 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 Hi Trend TechCo are associated (or correlated) with Xilinmen Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xilinmen Furniture has no effect on the direction of Hi Trend i.e., Hi Trend and Xilinmen Furniture go up and down completely randomly.
Pair Corralation between Hi Trend and Xilinmen Furniture
Assuming the 90 days trading horizon Hi Trend TechCo is expected to generate 1.24 times more return on investment than Xilinmen Furniture. However, Hi Trend is 1.24 times more volatile than Xilinmen Furniture Co. It trades about -0.02 of its potential returns per unit of risk. Xilinmen Furniture Co is currently generating about -0.03 per unit of risk. If you would invest 5,422 in Hi Trend TechCo on September 3, 2024 and sell it today you would lose (2,137) from holding Hi Trend TechCo or give up 39.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hi Trend TechCo vs. Xilinmen Furniture Co
Performance |
| Timeline |
| Hi Trend TechCo |
| Xilinmen Furniture |
Hi Trend and Xilinmen Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hi Trend and Xilinmen Furniture
The main advantage of trading using opposite Hi Trend and Xilinmen Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hi Trend position performs unexpectedly, Xilinmen Furniture 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 Xilinmen Furniture will offset losses from the drop in Xilinmen Furniture's long position.| Hi Trend vs. Tongxing Environmental Protection | Hi Trend vs. Anhui Fuhuang Steel | Hi Trend vs. Guangdong Liantai Environmental | Hi Trend vs. Beijing SPC Environment |
| Xilinmen Furniture vs. Tongxing Environmental Protection | Xilinmen Furniture vs. Ningbo Ligong Online | Xilinmen Furniture vs. Guangdong Advertising Co | Xilinmen Furniture vs. Bengang Steel Plates |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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