Correlation Between Old Dominion and Xiabuxiabu Catering

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Can any of the company-specific risk be diversified away by investing in both Old Dominion and Xiabuxiabu Catering 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 Old Dominion and Xiabuxiabu Catering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Old Dominion Freight and Xiabuxiabu Catering Management, you can compare the effects of market volatilities on Old Dominion and Xiabuxiabu Catering 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 Old Dominion with a short position of Xiabuxiabu Catering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Dominion and Xiabuxiabu Catering.

Diversification Opportunities for Old Dominion and Xiabuxiabu Catering

OldXiabuxiabuDiversified AwayOldXiabuxiabuDiversified Away100%
0.22
  Correlation Coefficient

Modest diversification

The 3 months correlation between Old and Xiabuxiabu is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Old Dominion Freight and Xiabuxiabu Catering Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiabuxiabu Catering and Old Dominion 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 Old Dominion Freight are associated (or correlated) with Xiabuxiabu Catering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiabuxiabu Catering has no effect on the direction of Old Dominion i.e., Old Dominion and Xiabuxiabu Catering go up and down completely randomly.

Pair Corralation between Old Dominion and Xiabuxiabu Catering

Given the investment horizon of 90 days Old Dominion Freight is expected to generate 1.29 times more return on investment than Xiabuxiabu Catering. However, Old Dominion is 1.29 times more volatile than Xiabuxiabu Catering Management. It trades about -0.02 of its potential returns per unit of risk. Xiabuxiabu Catering Management is currently generating about -0.13 per unit of risk. If you would invest  19,781  in Old Dominion Freight on October 21, 2024 and sell it today you would lose (826.00) from holding Old Dominion Freight or give up 4.18% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy98.41%
ValuesDaily Returns

Old Dominion Freight  vs.  Xiabuxiabu Catering Management

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -10-5051015
JavaScript chart by amCharts 3.21.15ODFL XIAXF
       Timeline  
Old Dominion Freight 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Old Dominion Freight has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, Old Dominion is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan180190200210220230
Xiabuxiabu Catering 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Xiabuxiabu Catering Management has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan0.120.1250.130.1350.140.1450.15

Old Dominion and Xiabuxiabu Catering Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.65-2.74-1.82-0.9-0.01530.841.732.623.514.4 0.060.080.100.12
JavaScript chart by amCharts 3.21.15ODFL XIAXF
       Returns  

Pair Trading with Old Dominion and Xiabuxiabu Catering

The main advantage of trading using opposite Old Dominion and Xiabuxiabu Catering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Dominion position performs unexpectedly, Xiabuxiabu Catering 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 Xiabuxiabu Catering will offset losses from the drop in Xiabuxiabu Catering's long position.
The idea behind Old Dominion Freight and Xiabuxiabu Catering 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.

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