Correlation Between Linewell Software and Xingguang Agricultural
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By analyzing existing cross correlation between Linewell Software Co and Xingguang Agricultural Mach, you can compare the effects of market volatilities on Linewell Software and Xingguang Agricultural 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 Linewell Software with a short position of Xingguang Agricultural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Linewell Software and Xingguang Agricultural.
Diversification Opportunities for Linewell Software and Xingguang Agricultural
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Linewell and Xingguang is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Linewell Software Co and Xingguang Agricultural Mach in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xingguang Agricultural and Linewell Software 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 Linewell Software Co are associated (or correlated) with Xingguang Agricultural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xingguang Agricultural has no effect on the direction of Linewell Software i.e., Linewell Software and Xingguang Agricultural go up and down completely randomly.
Pair Corralation between Linewell Software and Xingguang Agricultural
Assuming the 90 days trading horizon Linewell Software Co is expected to under-perform the Xingguang Agricultural. But the stock apears to be less risky and, when comparing its historical volatility, Linewell Software Co is 1.03 times less risky than Xingguang Agricultural. The stock trades about -0.01 of its potential returns per unit of risk. The Xingguang Agricultural Mach is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 807.00 in Xingguang Agricultural Mach on October 4, 2024 and sell it today you would lose (34.00) from holding Xingguang Agricultural Mach or give up 4.21% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Linewell Software Co vs. Xingguang Agricultural Mach
Performance |
Timeline |
Linewell Software |
Xingguang Agricultural |
Linewell Software and Xingguang Agricultural Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Linewell Software and Xingguang Agricultural
The main advantage of trading using opposite Linewell Software and Xingguang Agricultural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Linewell Software position performs unexpectedly, Xingguang Agricultural 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 Xingguang Agricultural will offset losses from the drop in Xingguang Agricultural's long position.Linewell Software vs. Cambricon Technologies Corp | ||
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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