Correlation Between Xiangyang Automobile and JCET Group
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and JCET Group Co, you can compare the effects of market volatilities on Xiangyang Automobile and JCET Group 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 Xiangyang Automobile with a short position of JCET Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and JCET Group.
Diversification Opportunities for Xiangyang Automobile and JCET Group
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Xiangyang and JCET is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and JCET Group Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JCET Group and Xiangyang Automobile 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 Xiangyang Automobile Bearing are associated (or correlated) with JCET Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JCET Group has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and JCET Group go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and JCET Group
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to under-perform the JCET Group. In addition to that, Xiangyang Automobile is 1.51 times more volatile than JCET Group Co. It trades about -0.17 of its total potential returns per unit of risk. JCET Group Co is currently generating about 0.1 per unit of volatility. If you would invest 3,784 in JCET Group Co on October 15, 2024 and sell it today you would earn a total of 224.00 from holding JCET Group Co or generate 5.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangyang Automobile Bearing vs. JCET Group Co
Performance |
| Timeline |
| Xiangyang Automobile |
| JCET Group |
Xiangyang Automobile and JCET Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and JCET Group
The main advantage of trading using opposite Xiangyang Automobile and JCET Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, JCET Group 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 JCET Group will offset losses from the drop in JCET Group's long position.The idea behind Xiangyang Automobile Bearing and JCET Group Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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