Correlation Between Xinhua Winshare and Informa PLC
Can any of the company-specific risk be diversified away by investing in both Xinhua Winshare and Informa PLC 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 Informa PLC 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 Informa PLC, you can compare the effects of market volatilities on Xinhua Winshare and Informa PLC 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 Informa PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinhua Winshare and Informa PLC.
Diversification Opportunities for Xinhua Winshare and Informa PLC
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xinhua and Informa is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Xinhua Winshare Publishing and Informa PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Informa PLC 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 Informa PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Informa PLC has no effect on the direction of Xinhua Winshare i.e., Xinhua Winshare and Informa PLC go up and down completely randomly.
Pair Corralation between Xinhua Winshare and Informa PLC
Assuming the 90 days horizon Xinhua Winshare Publishing is expected to generate 2.08 times more return on investment than Informa PLC. However, Xinhua Winshare is 2.08 times more volatile than Informa PLC. It trades about -0.08 of its potential returns per unit of risk. Informa PLC is currently generating about -0.3 per unit of risk. If you would invest 134.00 in Xinhua Winshare Publishing on October 15, 2024 and sell it today you would lose (4.00) from holding Xinhua Winshare Publishing or give up 2.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinhua Winshare Publishing vs. Informa PLC
Performance |
| Timeline |
| Xinhua Winshare Publ |
| Informa PLC |
Xinhua Winshare and Informa PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinhua Winshare and Informa PLC
The main advantage of trading using opposite Xinhua Winshare and Informa PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinhua Winshare position performs unexpectedly, Informa PLC 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 Informa PLC will offset losses from the drop in Informa PLC's long position.| Xinhua Winshare vs. CeoTronics AG | Xinhua Winshare vs. FORMPIPE SOFTWARE AB | Xinhua Winshare vs. CEOTRONICS | Xinhua Winshare vs. Take Two Interactive Software |
| Informa PLC vs. MICRONIC MYDATA | Informa PLC vs. NTT DATA | Informa PLC vs. EEDUCATION ALBERT AB | Informa PLC vs. Xinhua Winshare Publishing |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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