Correlation Between Xiwang Special and Corporate Travel

Can any of the company-specific risk be diversified away by investing in both Xiwang Special and Corporate Travel 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 Xiwang Special and Corporate Travel into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Xiwang Special Steel and Corporate Travel Management, you can compare the effects of market volatilities on Xiwang Special and Corporate Travel 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 Xiwang Special with a short position of Corporate Travel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiwang Special and Corporate Travel.

Diversification Opportunities for Xiwang Special and Corporate Travel

0.0

Correlation Coefficient

Xiwang Special  Corporate Travel

Pay attention - limited upside

The 3 months correlation between Xiwang and Corporate is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Xiwang Special Steel and Corporate Travel Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corporate Travel Man and Xiwang Special 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 Xiwang Special Steel are associated (or correlated) with Corporate Travel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corporate Travel Man has no effect on the direction of Xiwang Special i.e., Xiwang Special and Corporate Travel go up and down completely randomly.

Pair Corralation between Xiwang Special and Corporate Travel

If you would invest  805.00  in Corporate Travel Management on December 13, 2024 and sell it today you would earn a total of  30.00  from holding Corporate Travel Management or generate 3.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.31%
Values	Daily Returns

Xiwang Special Steel  vs.  Corporate Travel Management

Xiwang Special Steel

Risk-Adjusted Performance

Very Weak

Over the last 90 days Xiwang Special Steel has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Xiwang Special is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Corporate Travel Man

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Corporate Travel Management are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Corporate Travel is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Xiwang Special and Corporate Travel

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

The idea behind Xiwang Special Steel and Corporate Travel Management 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.