Correlation Between Generationome Properties and Xinyuan Real

Can any of the company-specific risk be diversified away by investing in both Generationome Properties and Xinyuan Real 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 Generationome Properties and Xinyuan Real into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Generationome Properties and Xinyuan Real Estate, you can compare the effects of market volatilities on Generationome Properties and Xinyuan Real 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 Generationome Properties with a short position of Xinyuan Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Generationome Properties and Xinyuan Real.

Diversification Opportunities for Generationome Properties and Xinyuan Real

-0.38

Correlation Coefficient

Generationome Properties  Xinyuan Real

Very good diversification

The 3 months correlation between Generationome and Xinyuan is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Generationome Properties and Xinyuan Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinyuan Real Estate and Generationome Properties 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 Generationome Properties are associated (or correlated) with Xinyuan Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinyuan Real Estate has no effect on the direction of Generationome Properties i.e., Generationome Properties and Xinyuan Real go up and down completely randomly.

Pair Corralation between Generationome Properties and Xinyuan Real

Given the investment horizon of 90 days Generationome Properties is expected to under-perform the Xinyuan Real. But the stock apears to be less risky and, when comparing its historical volatility, Generationome Properties is 3.57 times less risky than Xinyuan Real. The stock trades about -0.14 of its potential returns per unit of risk. The Xinyuan Real Estate is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  280.00  in Xinyuan Real Estate on August 31, 2024 and sell it today you would earn a total of  36.00  from holding Xinyuan Real Estate or generate 12.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Generationome Properties  vs.  Xinyuan Real Estate

Generationome Properties

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Generationome Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in December 2024. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Xinyuan Real Estate

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Xinyuan Real Estate are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very weak forward indicators, Xinyuan Real displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Generationome Properties and Xinyuan Real

The main advantage of trading using opposite Generationome Properties and Xinyuan Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Generationome Properties position performs unexpectedly, Xinyuan Real 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 Xinyuan Real will offset losses from the drop in Xinyuan Real's long position.

The idea behind Generationome Properties and Xinyuan Real Estate pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.