Correlation Between Tongling Nonferrous and Jinling Hotel
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By analyzing existing cross correlation between Tongling Nonferrous Metals and Jinling Hotel Corp, you can compare the effects of market volatilities on Tongling Nonferrous and Jinling Hotel 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 Tongling Nonferrous with a short position of Jinling Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tongling Nonferrous and Jinling Hotel.
Diversification Opportunities for Tongling Nonferrous and Jinling Hotel
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tongling and Jinling is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Tongling Nonferrous Metals and Jinling Hotel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinling Hotel Corp and Tongling Nonferrous 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 Tongling Nonferrous Metals are associated (or correlated) with Jinling Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinling Hotel Corp has no effect on the direction of Tongling Nonferrous i.e., Tongling Nonferrous and Jinling Hotel go up and down completely randomly.
Pair Corralation between Tongling Nonferrous and Jinling Hotel
Assuming the 90 days trading horizon Tongling Nonferrous is expected to generate 4.87 times less return on investment than Jinling Hotel. But when comparing it to its historical volatility, Tongling Nonferrous Metals is 1.25 times less risky than Jinling Hotel. It trades about 0.08 of its potential returns per unit of risk. Jinling Hotel Corp is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 695.00 in Jinling Hotel Corp on September 15, 2024 and sell it today you would earn a total of 103.00 from holding Jinling Hotel Corp or generate 14.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tongling Nonferrous Metals vs. Jinling Hotel Corp
Performance |
| Timeline |
| Tongling Nonferrous |
| Jinling Hotel Corp |
Tongling Nonferrous and Jinling Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tongling Nonferrous and Jinling Hotel
The main advantage of trading using opposite Tongling Nonferrous and Jinling Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tongling Nonferrous position performs unexpectedly, Jinling Hotel 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 Jinling Hotel will offset losses from the drop in Jinling Hotel's long position.| Tongling Nonferrous vs. Zijin Mining Group | Tongling Nonferrous vs. Wanhua Chemical Group | Tongling Nonferrous vs. Baoshan Iron Steel | Tongling Nonferrous vs. Shandong Gold Mining |
| Jinling Hotel vs. Runjian Communication Co | Jinling Hotel vs. Shanghai Yanpu Metal | Jinling Hotel vs. Sunwave Communications Co | Jinling Hotel vs. Tongling Nonferrous Metals |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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