Correlation Between China Information and Xunlei
Can any of the company-specific risk be diversified away by investing in both China Information and Xunlei 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 China Information and Xunlei into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Information Technology and Xunlei Ltd Adr, you can compare the effects of market volatilities on China Information and Xunlei 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 China Information with a short position of Xunlei. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Information and Xunlei.
Diversification Opportunities for China Information and Xunlei
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Xunlei is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Information Technology and Xunlei Ltd Adr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xunlei Ltd Adr and China Information 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 China Information Technology are associated (or correlated) with Xunlei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xunlei Ltd Adr has no effect on the direction of China Information i.e., China Information and Xunlei go up and down completely randomly.
Pair Corralation between China Information and Xunlei
If you would invest 147.00 in Xunlei Ltd Adr on January 24, 2024 and sell it today you would earn a total of 9.00 from holding Xunlei Ltd Adr or generate 6.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
China Information Technology vs. Xunlei Ltd Adr
Performance |
| Timeline |
| China Information |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Xunlei Ltd Adr |
China Information and Xunlei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Information and Xunlei
The main advantage of trading using opposite China Information and Xunlei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Information position performs unexpectedly, Xunlei 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 Xunlei will offset losses from the drop in Xunlei's long position.| China Information vs. Willamette Valley Vineyards | China Information vs. Keurig Dr Pepper | China Information vs. Perseus Mining Limited | China Information vs. Electrovaya Common Shares |
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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