Correlation Between Xinhua Winshare and Dalata Hotel
Can any of the company-specific risk be diversified away by investing in both Xinhua Winshare and Dalata Hotel 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 Dalata Hotel 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 Dalata Hotel Group, you can compare the effects of market volatilities on Xinhua Winshare and Dalata Hotel 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 Dalata Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinhua Winshare and Dalata Hotel.
Diversification Opportunities for Xinhua Winshare and Dalata Hotel
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xinhua and Dalata is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Xinhua Winshare Publishing and Dalata Hotel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dalata Hotel Group 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 Dalata Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dalata Hotel Group has no effect on the direction of Xinhua Winshare i.e., Xinhua Winshare and Dalata Hotel go up and down completely randomly.
Pair Corralation between Xinhua Winshare and Dalata Hotel
Assuming the 90 days horizon Xinhua Winshare Publishing is expected to under-perform the Dalata Hotel. In addition to that, Xinhua Winshare is 1.5 times more volatile than Dalata Hotel Group. It trades about -0.23 of its total potential returns per unit of risk. Dalata Hotel Group is currently generating about 0.21 per unit of volatility. If you would invest 459.00 in Dalata Hotel Group on October 25, 2024 and sell it today you would earn a total of 25.00 from holding Dalata Hotel Group or generate 5.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinhua Winshare Publishing vs. Dalata Hotel Group
Performance |
| Timeline |
| Xinhua Winshare Publ |
| Dalata Hotel Group |
Xinhua Winshare and Dalata Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinhua Winshare and Dalata Hotel
The main advantage of trading using opposite Xinhua Winshare and Dalata Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinhua Winshare position performs unexpectedly, Dalata Hotel 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 Dalata Hotel will offset losses from the drop in Dalata Hotel's long position.| Xinhua Winshare vs. China Datang | Xinhua Winshare vs. Western Copper and | Xinhua Winshare vs. Stewart Information Services | Xinhua Winshare vs. GALENA MINING LTD |
| Dalata Hotel vs. Hyrican Informationssysteme Aktiengesellschaft | Dalata Hotel vs. Cass Information Systems | Dalata Hotel vs. Alliance Data Systems | Dalata Hotel vs. Datadog |
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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