Correlation Between Pengxin International and Xiangyang Automobile
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By analyzing existing cross correlation between Pengxin International Mining and Xiangyang Automobile Bearing, you can compare the effects of market volatilities on Pengxin International and Xiangyang Automobile 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 Pengxin International with a short position of Xiangyang Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pengxin International and Xiangyang Automobile.
Diversification Opportunities for Pengxin International and Xiangyang Automobile
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Pengxin and Xiangyang is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Pengxin International Mining and Xiangyang Automobile Bearing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiangyang Automobile and Pengxin International 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 Pengxin International Mining are associated (or correlated) with Xiangyang Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiangyang Automobile has no effect on the direction of Pengxin International i.e., Pengxin International and Xiangyang Automobile go up and down completely randomly.
Pair Corralation between Pengxin International and Xiangyang Automobile
Assuming the 90 days trading horizon Pengxin International is expected to generate 1.01 times less return on investment than Xiangyang Automobile. But when comparing it to its historical volatility, Pengxin International Mining is 1.1 times less risky than Xiangyang Automobile. It trades about 0.23 of its potential returns per unit of risk. Xiangyang Automobile Bearing is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 400.00 in Xiangyang Automobile Bearing on September 5, 2024 and sell it today you would earn a total of 236.00 from holding Xiangyang Automobile Bearing or generate 59.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Pengxin International Mining vs. Xiangyang Automobile Bearing
Performance |
Timeline |
Pengxin International |
Xiangyang Automobile |
Pengxin International and Xiangyang Automobile Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Pengxin International and Xiangyang Automobile
The main advantage of trading using opposite Pengxin International and Xiangyang Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pengxin International position performs unexpectedly, Xiangyang Automobile 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 Xiangyang Automobile will offset losses from the drop in Xiangyang Automobile's long position.Pengxin International vs. Gem Year Industrial Co | Pengxin International vs. ButOne Information Corp | Pengxin International vs. CITIC Metal Co | Pengxin International vs. Qinghaihuading Industrial Co |
Xiangyang Automobile vs. Hangzhou Gaoxin Rubber | Xiangyang Automobile vs. Jiangnan Mould Plastic | Xiangyang Automobile vs. Anji Foodstuff Co | Xiangyang Automobile vs. Ligao Foods CoLtd |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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