Correlation Between Xinhua Winshare and Quaker Chemical
Can any of the company-specific risk be diversified away by investing in both Xinhua Winshare and Quaker Chemical 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 Quaker Chemical 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 Quaker Chemical, you can compare the effects of market volatilities on Xinhua Winshare and Quaker Chemical 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 Quaker Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinhua Winshare and Quaker Chemical.
Diversification Opportunities for Xinhua Winshare and Quaker Chemical
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Xinhua and Quaker is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Xinhua Winshare Publishing and Quaker Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quaker Chemical 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 Quaker Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quaker Chemical has no effect on the direction of Xinhua Winshare i.e., Xinhua Winshare and Quaker Chemical go up and down completely randomly.
Pair Corralation between Xinhua Winshare and Quaker Chemical
Assuming the 90 days horizon Xinhua Winshare Publishing is expected to generate 1.06 times more return on investment than Quaker Chemical. However, Xinhua Winshare is 1.06 times more volatile than Quaker Chemical. It trades about 0.31 of its potential returns per unit of risk. Quaker Chemical is currently generating about -0.27 per unit of risk. If you would invest 114.00 in Xinhua Winshare Publishing on September 13, 2024 and sell it today you would earn a total of 14.00 from holding Xinhua Winshare Publishing or generate 12.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Xinhua Winshare Publishing vs. Quaker Chemical
Performance |
| Timeline |
| Xinhua Winshare Publ |
| Quaker Chemical |
Xinhua Winshare and Quaker Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinhua Winshare and Quaker Chemical
The main advantage of trading using opposite Xinhua Winshare and Quaker Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinhua Winshare position performs unexpectedly, Quaker Chemical 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 Quaker Chemical will offset losses from the drop in Quaker Chemical's long position.| Xinhua Winshare vs. Superior Plus Corp | Xinhua Winshare vs. SIVERS SEMICONDUCTORS AB | Xinhua Winshare vs. Norsk Hydro ASA | Xinhua Winshare vs. Reliance Steel Aluminum |
| Quaker Chemical vs. LANDSEA HOMES P | Quaker Chemical vs. FIREWEED METALS P | Quaker Chemical vs. Addus HomeCare | Quaker Chemical vs. Lion One Metals |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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