Correlation Between Snap and Xinjiang Beixin
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By analyzing existing cross correlation between Snap Inc and Xinjiang Beixin RoadBridge, you can compare the effects of market volatilities on Snap and Xinjiang Beixin 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 Snap with a short position of Xinjiang Beixin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and Xinjiang Beixin.
Diversification Opportunities for Snap and Xinjiang Beixin
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Snap and Xinjiang is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc and Xinjiang Beixin RoadBridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Beixin Road and Snap 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 Snap Inc are associated (or correlated) with Xinjiang Beixin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Beixin Road has no effect on the direction of Snap i.e., Snap and Xinjiang Beixin go up and down completely randomly.
Pair Corralation between Snap and Xinjiang Beixin
Given the investment horizon of 90 days Snap Inc is expected to under-perform the Xinjiang Beixin. But the stock apears to be less risky and, when comparing its historical volatility, Snap Inc is 1.17 times less risky than Xinjiang Beixin. The stock trades about -0.03 of its potential returns per unit of risk. The Xinjiang Beixin RoadBridge is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 378.00 in Xinjiang Beixin RoadBridge on September 1, 2024 and sell it today you would earn a total of 37.00 from holding Xinjiang Beixin RoadBridge or generate 9.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Snap Inc vs. Xinjiang Beixin RoadBridge
Performance |
| Timeline |
| Snap Inc |
| Xinjiang Beixin Road |
Snap and Xinjiang Beixin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snap and Xinjiang Beixin
The main advantage of trading using opposite Snap and Xinjiang Beixin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap position performs unexpectedly, Xinjiang Beixin 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 Xinjiang Beixin will offset losses from the drop in Xinjiang Beixin's long position.The idea behind Snap Inc and Xinjiang Beixin RoadBridge pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Xinjiang Beixin vs. Humanwell Healthcare Group | Xinjiang Beixin vs. De Rucci Healthy | Xinjiang Beixin vs. Xinke Material | Xinjiang Beixin vs. Kangxin New 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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