Correlation Between Digital China and Jointo Energy
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By analyzing existing cross correlation between Digital China Information and Jointo Energy Investment, you can compare the effects of market volatilities on Digital China and Jointo Energy 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 Digital China with a short position of Jointo Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital China and Jointo Energy.
Diversification Opportunities for Digital China and Jointo Energy
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Digital and Jointo is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Digital China Information and Jointo Energy Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jointo Energy Investment and Digital China 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 Digital China Information are associated (or correlated) with Jointo Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jointo Energy Investment has no effect on the direction of Digital China i.e., Digital China and Jointo Energy go up and down completely randomly.
Pair Corralation between Digital China and Jointo Energy
Assuming the 90 days trading horizon Digital China Information is expected to generate 1.75 times more return on investment than Jointo Energy. However, Digital China is 1.75 times more volatile than Jointo Energy Investment. It trades about 0.15 of its potential returns per unit of risk. Jointo Energy Investment is currently generating about 0.1 per unit of risk. If you would invest 1,271 in Digital China Information on September 14, 2024 and sell it today you would earn a total of 136.00 from holding Digital China Information or generate 10.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Digital China Information vs. Jointo Energy Investment
Performance |
| Timeline |
| Digital China Information |
| Jointo Energy Investment |
Digital China and Jointo Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital China and Jointo Energy
The main advantage of trading using opposite Digital China and Jointo Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital China position performs unexpectedly, Jointo Energy 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 Jointo Energy will offset losses from the drop in Jointo Energy's long position.| Digital China vs. China Petroleum Chemical | Digital China vs. PetroChina Co Ltd | Digital China vs. China State Construction | Digital China vs. China Railway Group |
| Jointo Energy vs. Changjiang Jinggong Steel | Jointo Energy vs. Guangdong Qunxing Toys | Jointo Energy vs. Hubei Geoway Investment | Jointo Energy vs. Shenzhen MYS Environmental |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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