Correlation Between Anhui Conch and Xinyi Glass
Can any of the company-specific risk be diversified away by investing in both Anhui Conch and Xinyi Glass at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Anhui Conch and Xinyi Glass into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anhui Conch Cement and Xinyi Glass Holdings, you can compare the effects of market volatilities on Anhui Conch and Xinyi Glass 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 Anhui Conch with a short position of Xinyi Glass. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Conch and Xinyi Glass.
Diversification Opportunities for Anhui Conch and Xinyi Glass
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Anhui and Xinyi is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Conch Cement and Xinyi Glass Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinyi Glass Holdings and Anhui Conch 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 Anhui Conch Cement are associated (or correlated) with Xinyi Glass. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinyi Glass Holdings has no effect on the direction of Anhui Conch i.e., Anhui Conch and Xinyi Glass go up and down completely randomly.
Pair Corralation between Anhui Conch and Xinyi Glass
Assuming the 90 days horizon Anhui Conch Cement is expected to under-perform the Xinyi Glass. But the pink sheet apears to be less risky and, when comparing its historical volatility, Anhui Conch Cement is 25.07 times less risky than Xinyi Glass. The pink sheet trades about 0.0 of its potential returns per unit of risk. The Xinyi Glass Holdings is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 46.00 in Xinyi Glass Holdings on August 27, 2024 and sell it today you would earn a total of 64.00 from holding Xinyi Glass Holdings or generate 139.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 85.28% |
| Values | Daily Returns |
Anhui Conch Cement vs. Xinyi Glass Holdings
Performance |
| Timeline |
| Anhui Conch Cement |
| Xinyi Glass Holdings |
Anhui Conch and Xinyi Glass Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Conch and Xinyi Glass
The main advantage of trading using opposite Anhui Conch and Xinyi Glass positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Conch position performs unexpectedly, Xinyi Glass 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 Xinyi Glass will offset losses from the drop in Xinyi Glass' long position.| Anhui Conch vs. Buzzi Unicem SpA | Anhui Conch vs. Wienerberger Baustoffindustrie | Anhui Conch vs. Lafargeholcim Ltd ADR | Anhui Conch vs. HeidelbergCement AG ADR |
| Xinyi Glass vs. Anhui Conch Cement | Xinyi Glass vs. CEMEX SAB de | Xinyi Glass vs. CEMATRIX | Xinyi Glass vs. Anhui Conch Cement |
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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