Correlation Between Xilong Chemical and SuZhou ChunXing
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By analyzing existing cross correlation between Xilong Chemical Co and SuZhou ChunXing Precision, you can compare the effects of market volatilities on Xilong Chemical and SuZhou ChunXing 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 Xilong Chemical with a short position of SuZhou ChunXing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xilong Chemical and SuZhou ChunXing.
Diversification Opportunities for Xilong Chemical and SuZhou ChunXing
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xilong and SuZhou is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Xilong Chemical Co and SuZhou ChunXing Precision in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SuZhou ChunXing Precision and Xilong Chemical 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 Xilong Chemical Co are associated (or correlated) with SuZhou ChunXing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SuZhou ChunXing Precision has no effect on the direction of Xilong Chemical i.e., Xilong Chemical and SuZhou ChunXing go up and down completely randomly.
Pair Corralation between Xilong Chemical and SuZhou ChunXing
Assuming the 90 days trading horizon Xilong Chemical is expected to generate 2.43 times less return on investment than SuZhou ChunXing. But when comparing it to its historical volatility, Xilong Chemical Co is 1.41 times less risky than SuZhou ChunXing. It trades about 0.09 of its potential returns per unit of risk. SuZhou ChunXing Precision is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 312.00 in SuZhou ChunXing Precision on September 25, 2024 and sell it today you would earn a total of 177.00 from holding SuZhou ChunXing Precision or generate 56.73% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 98.33% |
Values | Daily Returns |
Xilong Chemical Co vs. SuZhou ChunXing Precision
Performance |
Timeline |
Xilong Chemical |
SuZhou ChunXing Precision |
Xilong Chemical and SuZhou ChunXing Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xilong Chemical and SuZhou ChunXing
The main advantage of trading using opposite Xilong Chemical and SuZhou ChunXing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xilong Chemical position performs unexpectedly, SuZhou ChunXing 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 SuZhou ChunXing will offset losses from the drop in SuZhou ChunXing's long position.Xilong Chemical vs. Zijin Mining Group | Xilong Chemical vs. Wanhua Chemical Group | Xilong Chemical vs. Baoshan Iron Steel | Xilong Chemical vs. Shandong Gold Mining |
SuZhou ChunXing vs. Wanhua Chemical Group | SuZhou ChunXing vs. Baoshan Iron Steel | SuZhou ChunXing vs. Shandong Gold Mining | SuZhou ChunXing vs. Rongsheng Petrochemical Co |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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