Correlation Between Xinyi Glass and Ibstock Plc
Can any of the company-specific risk be diversified away by investing in both Xinyi Glass and Ibstock 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 Xinyi Glass and Ibstock Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xinyi Glass Holdings and Ibstock Plc, you can compare the effects of market volatilities on Xinyi Glass and Ibstock 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 Xinyi Glass with a short position of Ibstock Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinyi Glass and Ibstock Plc.
Diversification Opportunities for Xinyi Glass and Ibstock Plc
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Xinyi and Ibstock is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Xinyi Glass Holdings and Ibstock Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ibstock Plc and Xinyi Glass 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 Xinyi Glass Holdings are associated (or correlated) with Ibstock Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ibstock Plc has no effect on the direction of Xinyi Glass i.e., Xinyi Glass and Ibstock Plc go up and down completely randomly.
Pair Corralation between Xinyi Glass and Ibstock Plc
Assuming the 90 days horizon Xinyi Glass Holdings is expected to generate 11.06 times more return on investment than Ibstock Plc. However, Xinyi Glass is 11.06 times more volatile than Ibstock Plc. It trades about 0.09 of its potential returns per unit of risk. Ibstock Plc is currently generating about -0.09 per unit of risk. If you would invest 47.00 in Xinyi Glass Holdings on November 5, 2024 and sell it today you would earn a total of 46.00 from holding Xinyi Glass Holdings or generate 97.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 43.86% |
| Values | Daily Returns |
Xinyi Glass Holdings vs. Ibstock Plc
Performance |
| Timeline |
| Xinyi Glass Holdings |
| Ibstock Plc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Xinyi Glass and Ibstock Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinyi Glass and Ibstock Plc
The main advantage of trading using opposite Xinyi Glass and Ibstock Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinyi Glass position performs unexpectedly, Ibstock 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 Ibstock Plc will offset losses from the drop in Ibstock Plc's long position.| Xinyi Glass vs. Anhui Conch Cement | Xinyi Glass vs. CEMEX SAB de | Xinyi Glass vs. CEMATRIX | Xinyi Glass vs. Anhui Conch Cement |
| Ibstock Plc vs. Xinyi Glass Holdings | Ibstock Plc vs. CEMATRIX | Ibstock Plc vs. Anhui Conch Cement | Ibstock Plc vs. Basanite |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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