Correlation Between Ningxia Younglight and Jinling Hotel
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By analyzing existing cross correlation between Ningxia Younglight Chemicals and Jinling Hotel Corp, you can compare the effects of market volatilities on Ningxia Younglight 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 Ningxia Younglight with a short position of Jinling Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningxia Younglight and Jinling Hotel.
Diversification Opportunities for Ningxia Younglight and Jinling Hotel
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ningxia and Jinling is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Ningxia Younglight Chemicals 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 Ningxia Younglight 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 Ningxia Younglight Chemicals 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 Ningxia Younglight i.e., Ningxia Younglight and Jinling Hotel go up and down completely randomly.
Pair Corralation between Ningxia Younglight and Jinling Hotel
Assuming the 90 days trading horizon Ningxia Younglight Chemicals is expected to generate 1.31 times more return on investment than Jinling Hotel. However, Ningxia Younglight is 1.31 times more volatile than Jinling Hotel Corp. It trades about 0.01 of its potential returns per unit of risk. Jinling Hotel Corp is currently generating about -0.01 per unit of risk. If you would invest 900.00 in Ningxia Younglight Chemicals on August 29, 2024 and sell it today you would lose (73.00) from holding Ningxia Younglight Chemicals or give up 8.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningxia Younglight Chemicals vs. Jinling Hotel Corp
Performance |
| Timeline |
| Ningxia Younglight |
| Jinling Hotel Corp |
Ningxia Younglight and Jinling Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningxia Younglight and Jinling Hotel
The main advantage of trading using opposite Ningxia Younglight and Jinling Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningxia Younglight 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.| Ningxia Younglight vs. Zijin Mining Group | Ningxia Younglight vs. Wanhua Chemical Group | Ningxia Younglight vs. Baoshan Iron Steel | Ningxia Younglight vs. Shandong Gold Mining |
| Jinling Hotel vs. Biwin Storage Technology | Jinling Hotel vs. PetroChina Co Ltd | Jinling Hotel vs. Industrial and Commercial | Jinling Hotel vs. China Construction Bank |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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