Correlation Between Jilin Chemical and Boai NKY
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By analyzing existing cross correlation between Jilin Chemical Fibre and Boai NKY Pharmaceuticals, you can compare the effects of market volatilities on Jilin Chemical and Boai NKY 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 Boai NKY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jilin Chemical and Boai NKY.
Diversification Opportunities for Jilin Chemical and Boai NKY
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jilin and Boai is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Jilin Chemical Fibre and Boai NKY Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boai NKY Pharmaceuticals 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 Boai NKY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boai NKY Pharmaceuticals has no effect on the direction of Jilin Chemical i.e., Jilin Chemical and Boai NKY go up and down completely randomly.
Pair Corralation between Jilin Chemical and Boai NKY
Assuming the 90 days trading horizon Jilin Chemical Fibre is expected to generate 0.84 times more return on investment than Boai NKY. However, Jilin Chemical Fibre is 1.19 times less risky than Boai NKY. It trades about 0.01 of its potential returns per unit of risk. Boai NKY Pharmaceuticals is currently generating about 0.0 per unit of risk. If you would invest 441.00 in Jilin Chemical Fibre on September 12, 2024 and sell it today you would lose (11.00) from holding Jilin Chemical Fibre or give up 2.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
Jilin Chemical Fibre vs. Boai NKY Pharmaceuticals
Performance |
| Timeline |
| Jilin Chemical Fibre |
| Boai NKY Pharmaceuticals |
Jilin Chemical and Boai NKY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jilin Chemical and Boai NKY
The main advantage of trading using opposite Jilin Chemical and Boai NKY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jilin Chemical position performs unexpectedly, Boai NKY 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 Boai NKY will offset losses from the drop in Boai NKY's long position.| Jilin Chemical vs. Zijin Mining Group | Jilin Chemical vs. Wanhua Chemical Group | Jilin Chemical vs. Baoshan Iron Steel | Jilin Chemical vs. Rongsheng Petrochemical Co |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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