Correlation Between Xinke Material and Jinsanjiang Silicon
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By analyzing existing cross correlation between Xinke Material and Jinsanjiang Silicon Material, you can compare the effects of market volatilities on Xinke Material and Jinsanjiang Silicon 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 Xinke Material with a short position of Jinsanjiang Silicon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinke Material and Jinsanjiang Silicon.
Diversification Opportunities for Xinke Material and Jinsanjiang Silicon
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xinke and Jinsanjiang is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Xinke Material and Jinsanjiang Silicon Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinsanjiang Silicon and Xinke Material 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 Xinke Material are associated (or correlated) with Jinsanjiang Silicon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinsanjiang Silicon has no effect on the direction of Xinke Material i.e., Xinke Material and Jinsanjiang Silicon go up and down completely randomly.
Pair Corralation between Xinke Material and Jinsanjiang Silicon
Assuming the 90 days trading horizon Xinke Material is expected to generate 0.77 times more return on investment than Jinsanjiang Silicon. However, Xinke Material is 1.3 times less risky than Jinsanjiang Silicon. It trades about 0.04 of its potential returns per unit of risk. Jinsanjiang Silicon Material is currently generating about 0.02 per unit of risk. If you would invest 266.00 in Xinke Material on September 26, 2024 and sell it today you would earn a total of 120.00 from holding Xinke Material or generate 45.11% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Xinke Material vs. Jinsanjiang Silicon Material
Performance |
Timeline |
Xinke Material |
Jinsanjiang Silicon |
Xinke Material and Jinsanjiang Silicon Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xinke Material and Jinsanjiang Silicon
The main advantage of trading using opposite Xinke Material and Jinsanjiang Silicon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinke Material position performs unexpectedly, Jinsanjiang Silicon 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 Jinsanjiang Silicon will offset losses from the drop in Jinsanjiang Silicon's long position.Xinke Material vs. Wanhua Chemical Group | Xinke Material vs. Shandong Gold Mining | Xinke Material vs. Rongsheng Petrochemical Co | Xinke Material vs. Inner Mongolia BaoTou |
Jinsanjiang Silicon vs. Zijin Mining Group | Jinsanjiang Silicon vs. Wanhua Chemical Group | Jinsanjiang Silicon vs. Baoshan Iron Steel | Jinsanjiang Silicon vs. Shandong Gold Mining |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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