Correlation Between Ushio and Xinjiang Goldwind

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

By analyzing existing cross correlation between Ushio Inc and Xinjiang Goldwind Science, you can compare the effects of market volatilities on Ushio and Xinjiang Goldwind 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 Ushio with a short position of Xinjiang Goldwind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ushio and Xinjiang Goldwind.

Diversification Opportunities for Ushio and Xinjiang Goldwind

0.17

Correlation Coefficient

Ushio  Xinjiang Goldwind

Average diversification

The 3 months correlation between Ushio and Xinjiang is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Ushio Inc and Xinjiang Goldwind Science in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Goldwind Science and Ushio 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 Ushio Inc are associated (or correlated) with Xinjiang Goldwind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Goldwind Science has no effect on the direction of Ushio i.e., Ushio and Xinjiang Goldwind go up and down completely randomly.

Pair Corralation between Ushio and Xinjiang Goldwind

Assuming the 90 days horizon Ushio Inc is expected to generate 0.52 times more return on investment than Xinjiang Goldwind. However, Ushio Inc is 1.91 times less risky than Xinjiang Goldwind. It trades about 0.02 of its potential returns per unit of risk. Xinjiang Goldwind Science is currently generating about -0.17 per unit of risk. If you would invest  1,400  in Ushio Inc on December 4, 2024 and sell it today you would earn a total of  10.00  from holding Ushio Inc or generate 0.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	73.33%
Values	Daily Returns

Ushio Inc  vs.  Xinjiang Goldwind Science

Ushio Inc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ushio Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable forward indicators, Ushio is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Xinjiang Goldwind Science

Risk-Adjusted Performance

Very Weak

Over the last 90 days Xinjiang Goldwind Science 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 technical and fundamental indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Ushio and Xinjiang Goldwind

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

The idea behind Ushio Inc and Xinjiang Goldwind Science 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.

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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.