Correlation Between Weichai Heavy and Jiangsu Jinling
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By analyzing existing cross correlation between Weichai Heavy Machinery and Jiangsu Jinling Sports, you can compare the effects of market volatilities on Weichai Heavy and Jiangsu Jinling 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 Weichai Heavy with a short position of Jiangsu Jinling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weichai Heavy and Jiangsu Jinling.
Diversification Opportunities for Weichai Heavy and Jiangsu Jinling
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Weichai and Jiangsu is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Weichai Heavy Machinery and Jiangsu Jinling Sports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Jinling Sports and Weichai Heavy 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 Weichai Heavy Machinery are associated (or correlated) with Jiangsu Jinling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Jinling Sports has no effect on the direction of Weichai Heavy i.e., Weichai Heavy and Jiangsu Jinling go up and down completely randomly.
Pair Corralation between Weichai Heavy and Jiangsu Jinling
Assuming the 90 days trading horizon Weichai Heavy Machinery is expected to generate 2.29 times more return on investment than Jiangsu Jinling. However, Weichai Heavy is 2.29 times more volatile than Jiangsu Jinling Sports. It trades about 0.12 of its potential returns per unit of risk. Jiangsu Jinling Sports is currently generating about 0.07 per unit of risk. If you would invest 1,118 in Weichai Heavy Machinery on August 29, 2024 and sell it today you would earn a total of 131.00 from holding Weichai Heavy Machinery or generate 11.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weichai Heavy Machinery vs. Jiangsu Jinling Sports
Performance |
| Timeline |
| Weichai Heavy Machinery |
| Jiangsu Jinling Sports |
Weichai Heavy and Jiangsu Jinling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weichai Heavy and Jiangsu Jinling
The main advantage of trading using opposite Weichai Heavy and Jiangsu Jinling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weichai Heavy position performs unexpectedly, Jiangsu Jinling 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 Jiangsu Jinling will offset losses from the drop in Jiangsu Jinling's long position.| Weichai Heavy vs. China Asset Management | Weichai Heavy vs. Harvest Fund Management | Weichai Heavy vs. JCHX Mining Management | Weichai Heavy vs. AVIC Fund Management |
| Jiangsu Jinling vs. Shenzhen MYS Environmental | Jiangsu Jinling vs. AVIC Fund Management | Jiangsu Jinling vs. Shenzhen Bingchuan Network | Jiangsu Jinling vs. Penghua Shenzhen Energy |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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