Correlation Between Xinhua Winshare and CAREER EDUCATION
Can any of the company-specific risk be diversified away by investing in both Xinhua Winshare and CAREER EDUCATION 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 Xinhua Winshare and CAREER EDUCATION into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xinhua Winshare Publishing and CAREER EDUCATION, you can compare the effects of market volatilities on Xinhua Winshare and CAREER EDUCATION 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 Xinhua Winshare with a short position of CAREER EDUCATION. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinhua Winshare and CAREER EDUCATION.
Diversification Opportunities for Xinhua Winshare and CAREER EDUCATION
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xinhua and CAREER is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Xinhua Winshare Publishing and CAREER EDUCATION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAREER EDUCATION and Xinhua Winshare 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 Xinhua Winshare Publishing are associated (or correlated) with CAREER EDUCATION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAREER EDUCATION has no effect on the direction of Xinhua Winshare i.e., Xinhua Winshare and CAREER EDUCATION go up and down completely randomly.
Pair Corralation between Xinhua Winshare and CAREER EDUCATION
Assuming the 90 days horizon Xinhua Winshare is expected to generate 1.04 times less return on investment than CAREER EDUCATION. In addition to that, Xinhua Winshare is 1.19 times more volatile than CAREER EDUCATION. It trades about 0.08 of its total potential returns per unit of risk. CAREER EDUCATION is currently generating about 0.1 per unit of volatility. If you would invest 2,047 in CAREER EDUCATION on September 1, 2024 and sell it today you would earn a total of 553.00 from holding CAREER EDUCATION or generate 27.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinhua Winshare Publishing vs. CAREER EDUCATION
Performance |
| Timeline |
| Xinhua Winshare Publ |
| CAREER EDUCATION |
Xinhua Winshare and CAREER EDUCATION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinhua Winshare and CAREER EDUCATION
The main advantage of trading using opposite Xinhua Winshare and CAREER EDUCATION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinhua Winshare position performs unexpectedly, CAREER EDUCATION 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 CAREER EDUCATION will offset losses from the drop in CAREER EDUCATION's long position.| Xinhua Winshare vs. Superior Plus Corp | Xinhua Winshare vs. NMI Holdings | Xinhua Winshare vs. Origin Agritech | Xinhua Winshare vs. SIVERS SEMICONDUCTORS AB |
| CAREER EDUCATION vs. SIVERS SEMICONDUCTORS AB | CAREER EDUCATION vs. Darden Restaurants | CAREER EDUCATION vs. Reliance Steel Aluminum | CAREER EDUCATION vs. Q2M Managementberatung AG |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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