Correlation Between Shaanxi Energy and Jiangsu Financial
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By analyzing existing cross correlation between Shaanxi Energy Investment and Jiangsu Financial Leasing, you can compare the effects of market volatilities on Shaanxi Energy and Jiangsu Financial 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 Shaanxi Energy with a short position of Jiangsu Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaanxi Energy and Jiangsu Financial.
Diversification Opportunities for Shaanxi Energy and Jiangsu Financial
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shaanxi and Jiangsu is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Shaanxi Energy Investment and Jiangsu Financial Leasing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Financial Leasing and Shaanxi 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 Shaanxi Energy Investment are associated (or correlated) with Jiangsu Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Financial Leasing has no effect on the direction of Shaanxi Energy i.e., Shaanxi Energy and Jiangsu Financial go up and down completely randomly.
Pair Corralation between Shaanxi Energy and Jiangsu Financial
Assuming the 90 days trading horizon Shaanxi Energy Investment is expected to under-perform the Jiangsu Financial. In addition to that, Shaanxi Energy is 1.2 times more volatile than Jiangsu Financial Leasing. It trades about -0.03 of its total potential returns per unit of risk. Jiangsu Financial Leasing is currently generating about 0.05 per unit of volatility. If you would invest 356.00 in Jiangsu Financial Leasing on September 14, 2024 and sell it today you would earn a total of 157.00 from holding Jiangsu Financial Leasing or generate 44.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 85.71% |
| Values | Daily Returns |
Shaanxi Energy Investment vs. Jiangsu Financial Leasing
Performance |
| Timeline |
| Shaanxi Energy Investment |
| Jiangsu Financial Leasing |
Shaanxi Energy and Jiangsu Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shaanxi Energy and Jiangsu Financial
The main advantage of trading using opposite Shaanxi Energy and Jiangsu Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaanxi Energy position performs unexpectedly, Jiangsu Financial 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 Financial will offset losses from the drop in Jiangsu Financial's long position.| Shaanxi Energy vs. Zhejiang Kingland Pipeline | Shaanxi Energy vs. HOB Biotech Group | Shaanxi Energy vs. Ming Yang Smart | Shaanxi Energy vs. 159681 |
| Jiangsu Financial vs. INKON Life Technology | Jiangsu Financial vs. Changchun UP Optotech | Jiangsu Financial vs. Shaanxi Energy Investment | Jiangsu Financial vs. Yuan Longping High tech |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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