Correlation Between Xunlei and NL Industries
Can any of the company-specific risk be diversified away by investing in both Xunlei and NL Industries 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 Xunlei and NL Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xunlei Ltd Adr and NL Industries, you can compare the effects of market volatilities on Xunlei and NL Industries 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 Xunlei with a short position of NL Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xunlei and NL Industries.
Diversification Opportunities for Xunlei and NL Industries
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Xunlei and NL Industries is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Xunlei Ltd Adr and NL Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NL Industries and Xunlei 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 Xunlei Ltd Adr are associated (or correlated) with NL Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NL Industries has no effect on the direction of Xunlei i.e., Xunlei and NL Industries go up and down completely randomly.
Pair Corralation between Xunlei and NL Industries
Given the investment horizon of 90 days Xunlei Ltd Adr is expected to generate 1.94 times more return on investment than NL Industries. However, Xunlei is 1.94 times more volatile than NL Industries. It trades about 0.2 of its potential returns per unit of risk. NL Industries is currently generating about -0.08 per unit of risk. If you would invest 214.00 in Xunlei Ltd Adr on December 2, 2024 and sell it today you would earn a total of 172.00 from holding Xunlei Ltd Adr or generate 80.37% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Xunlei Ltd Adr vs. NL Industries
Performance |
Timeline |
Xunlei Ltd Adr |
NL Industries |
Xunlei and NL Industries Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xunlei and NL Industries
The main advantage of trading using opposite Xunlei and NL Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xunlei position performs unexpectedly, NL Industries 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 NL Industries will offset losses from the drop in NL Industries' long position.Xunlei vs. Travelzoo | Xunlei vs. Emerald Expositions Events | Xunlei vs. Ziff Davis | Xunlei vs. Direct Digital Holdings |
NL Industries vs. Brinks Company | NL Industries vs. Allegion PLC | NL Industries vs. Resideo Technologies | NL Industries vs. Mistras Group |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Transaction History View history of all your transactions and understand their impact on performance | |
Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |