Correlation Between Jilin Chemical and China Reform
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By analyzing existing cross correlation between Jilin Chemical Fibre and China Reform Health, you can compare the effects of market volatilities on Jilin Chemical and China Reform 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 Jilin Chemical with a short position of China Reform. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jilin Chemical and China Reform.
Diversification Opportunities for Jilin Chemical and China Reform
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jilin and China is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Jilin Chemical Fibre and China Reform Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Reform Health and Jilin Chemical 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 Jilin Chemical Fibre are associated (or correlated) with China Reform. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Reform Health has no effect on the direction of Jilin Chemical i.e., Jilin Chemical and China Reform go up and down completely randomly.
Pair Corralation between Jilin Chemical and China Reform
Assuming the 90 days trading horizon Jilin Chemical Fibre is expected to under-perform the China Reform. But the stock apears to be less risky and, when comparing its historical volatility, Jilin Chemical Fibre is 1.05 times less risky than China Reform. The stock trades about -0.58 of its potential returns per unit of risk. The China Reform Health is currently generating about -0.49 of returns per unit of risk over similar time horizon. If you would invest 1,260 in China Reform Health on October 15, 2024 and sell it today you would lose (248.00) from holding China Reform Health or give up 19.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jilin Chemical Fibre vs. China Reform Health
Performance |
| Timeline |
| Jilin Chemical Fibre |
| China Reform Health |
Jilin Chemical and China Reform Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jilin Chemical and China Reform
The main advantage of trading using opposite Jilin Chemical and China Reform positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jilin Chemical position performs unexpectedly, China Reform 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 China Reform will offset losses from the drop in China Reform's long position.| Jilin Chemical vs. Dezhan HealthCare Co | Jilin Chemical vs. Healthcare Co | Jilin Chemical vs. Shanghai Rongtai Health | Jilin Chemical vs. Iat Automobile Technology |
| China Reform vs. Xilong Chemical Co | China Reform vs. Changchun BCHT Biotechnology | China Reform vs. SSAW Hotels Resorts | China Reform vs. Jilin Chemical Fibre |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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