Correlation Between Xunlei and Amgen
Can any of the company-specific risk be diversified away by investing in both Xunlei and Amgen 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 Xunlei and Amgen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xunlei Ltd Adr and Amgen Inc, you can compare the effects of market volatilities on Xunlei and Amgen 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 Xunlei with a short position of Amgen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xunlei and Amgen.
Diversification Opportunities for Xunlei and Amgen
Very good diversification
The 3 months correlation between Xunlei and Amgen is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Xunlei Ltd Adr and Amgen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amgen Inc and Xunlei 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 Xunlei Ltd Adr are associated (or correlated) with Amgen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amgen Inc has no effect on the direction of Xunlei i.e., Xunlei and Amgen go up and down completely randomly.
Pair Corralation between Xunlei and Amgen
Given the investment horizon of 90 days Xunlei Ltd Adr is expected to generate 1.8 times more return on investment than Amgen. However, Xunlei is 1.8 times more volatile than Amgen Inc. It trades about 0.15 of its potential returns per unit of risk. Amgen Inc is currently generating about -0.24 per unit of risk. If you would invest 191.00 in Xunlei Ltd Adr on September 4, 2024 and sell it today you would earn a total of 23.00 from holding Xunlei Ltd Adr or generate 12.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xunlei Ltd Adr vs. Amgen Inc
Performance |
| Timeline |
| Xunlei Ltd Adr |
| Amgen Inc |
Xunlei and Amgen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xunlei and Amgen
The main advantage of trading using opposite Xunlei and Amgen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xunlei position performs unexpectedly, Amgen 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 Amgen will offset losses from the drop in Amgen's long position.| Xunlei vs. Travelzoo | Xunlei vs. Emerald Expositions Events | Xunlei vs. Ziff Davis | Xunlei vs. Direct Digital Holdings |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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