Correlation Between DO Home and Xiamen Jihong
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By analyzing existing cross correlation between DO Home Collection and Xiamen Jihong Package, you can compare the effects of market volatilities on DO Home and Xiamen Jihong 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 DO Home with a short position of Xiamen Jihong. Check out your portfolio center. Please also check ongoing floating volatility patterns of DO Home and Xiamen Jihong.
Diversification Opportunities for DO Home and Xiamen Jihong
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 002798 and Xiamen is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding DO Home Collection and Xiamen Jihong Package in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Jihong Package and DO Home 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 DO Home Collection are associated (or correlated) with Xiamen Jihong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Jihong Package has no effect on the direction of DO Home i.e., DO Home and Xiamen Jihong go up and down completely randomly.
Pair Corralation between DO Home and Xiamen Jihong
Assuming the 90 days trading horizon DO Home Collection is expected to generate 1.41 times more return on investment than Xiamen Jihong. However, DO Home is 1.41 times more volatile than Xiamen Jihong Package. It trades about -0.01 of its potential returns per unit of risk. Xiamen Jihong Package is currently generating about -0.04 per unit of risk. If you would invest 394.00 in DO Home Collection on December 25, 2024 and sell it today you would lose (18.00) from holding DO Home Collection or give up 4.57% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
DO Home Collection vs. Xiamen Jihong Package
Performance |
Timeline |
DO Home Collection |
Xiamen Jihong Package |
DO Home and Xiamen Jihong Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with DO Home and Xiamen Jihong
The main advantage of trading using opposite DO Home and Xiamen Jihong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DO Home position performs unexpectedly, Xiamen Jihong 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 Xiamen Jihong will offset losses from the drop in Xiamen Jihong's long position.DO Home vs. De Rucci Healthy | DO Home vs. Runjian Communication Co | DO Home vs. Wuhan Yangtze Communication | DO Home vs. By health |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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