Correlation Between Snowflake and Xinda International
Can any of the company-specific risk be diversified away by investing in both Snowflake and Xinda International 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 Snowflake and Xinda International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snowflake and Xinda International Corp, you can compare the effects of market volatilities on Snowflake and Xinda International 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 Snowflake with a short position of Xinda International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snowflake and Xinda International.
Diversification Opportunities for Snowflake and Xinda International
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Snowflake and Xinda is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Snowflake and Xinda International Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinda International Corp and Snowflake 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 Snowflake are associated (or correlated) with Xinda International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinda International Corp has no effect on the direction of Snowflake i.e., Snowflake and Xinda International go up and down completely randomly.
Pair Corralation between Snowflake and Xinda International
Given the investment horizon of 90 days Snowflake is expected to generate 1.63 times less return on investment than Xinda International. But when comparing it to its historical volatility, Snowflake is 3.26 times less risky than Xinda International. It trades about 0.03 of its potential returns per unit of risk. Xinda International Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 12.00 in Xinda International Corp on September 3, 2024 and sell it today you would lose (11.96) from holding Xinda International Corp or give up 99.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Snowflake vs. Xinda International Corp
Performance |
| Timeline |
| Snowflake |
| Xinda International Corp |
Snowflake and Xinda International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Snowflake and Xinda International
The main advantage of trading using opposite Snowflake and Xinda International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snowflake position performs unexpectedly, Xinda International 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 Xinda International will offset losses from the drop in Xinda International's long position.The idea behind Snowflake and Xinda International Corp 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.| Xinda International vs. HeartCore Enterprises | Xinda International vs. Trust Stamp | Xinda International vs. Quhuo | Xinda International vs. Snowflake |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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