Correlation Between Jointo Energy and Digital China
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By analyzing existing cross correlation between Jointo Energy Investment and Digital China Information, you can compare the effects of market volatilities on Jointo Energy and Digital China 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 Jointo Energy with a short position of Digital China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jointo Energy and Digital China.
Diversification Opportunities for Jointo Energy and Digital China
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jointo and Digital is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Jointo Energy Investment and Digital China Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digital China Information and Jointo Energy 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 Jointo Energy Investment are associated (or correlated) with Digital China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digital China Information has no effect on the direction of Jointo Energy i.e., Jointo Energy and Digital China go up and down completely randomly.
Pair Corralation between Jointo Energy and Digital China
Assuming the 90 days trading horizon Jointo Energy is expected to generate 2.79 times less return on investment than Digital China. But when comparing it to its historical volatility, Jointo Energy Investment is 1.75 times less risky than Digital China. It trades about 0.1 of its potential returns per unit of risk. Digital China Information is currently generating about 0.15 of returns per unit of risk over similar time horizon. 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 |
Jointo Energy Investment vs. Digital China Information
Performance |
| Timeline |
| Jointo Energy Investment |
| Digital China Information |
Jointo Energy and Digital China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jointo Energy and Digital China
The main advantage of trading using opposite Jointo Energy and Digital China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jointo Energy position performs unexpectedly, Digital China 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 Digital China will offset losses from the drop in Digital China's long position.| Jointo Energy vs. Changjiang Jinggong Steel | Jointo Energy vs. Guangdong Qunxing Toys | Jointo Energy vs. Hubei Geoway Investment | Jointo Energy vs. Shenzhen MYS Environmental |
| Digital China vs. China Petroleum Chemical | Digital China vs. PetroChina Co Ltd | Digital China vs. China State Construction | Digital China vs. China Railway 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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