Correlation Between Xunlei and Conifex Timber
Can any of the company-specific risk be diversified away by investing in both Xunlei and Conifex Timber 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 Conifex Timber 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 Conifex Timber, you can compare the effects of market volatilities on Xunlei and Conifex Timber 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 Conifex Timber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xunlei and Conifex Timber.
Diversification Opportunities for Xunlei and Conifex Timber
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Xunlei and Conifex is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Xunlei Ltd Adr and Conifex Timber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conifex Timber 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 Conifex Timber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conifex Timber has no effect on the direction of Xunlei i.e., Xunlei and Conifex Timber go up and down completely randomly.
Pair Corralation between Xunlei and Conifex Timber
Given the investment horizon of 90 days Xunlei Ltd Adr is expected to generate 1.5 times more return on investment than Conifex Timber. However, Xunlei is 1.5 times more volatile than Conifex Timber. It trades about 0.37 of its potential returns per unit of risk. Conifex Timber is currently generating about -0.22 per unit of risk. If you would invest 210.00 in Xunlei Ltd Adr on November 9, 2024 and sell it today you would earn a total of 66.00 from holding Xunlei Ltd Adr or generate 31.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Xunlei Ltd Adr vs. Conifex Timber
Performance |
| Timeline |
| Xunlei Ltd Adr |
| Conifex Timber |
Xunlei and Conifex Timber Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xunlei and Conifex Timber
The main advantage of trading using opposite Xunlei and Conifex Timber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xunlei position performs unexpectedly, Conifex Timber 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 Conifex Timber will offset losses from the drop in Conifex Timber's long position.| Xunlei vs. Travelzoo | Xunlei vs. Emerald Expositions Events | Xunlei vs. Ziff Davis | Xunlei vs. Direct Digital Holdings |
| Conifex Timber vs. Wizz Air Holdings | Conifex Timber vs. Canada Goose Holdings | Conifex Timber vs. Tapestry | Conifex Timber vs. Ralph Lauren Corp |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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