Correlation Between China Merchants and Jiangxi JDL
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By analyzing existing cross correlation between China Merchants Shekou and Jiangxi JDL Environmental, you can compare the effects of market volatilities on China Merchants and Jiangxi JDL 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 China Merchants with a short position of Jiangxi JDL. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Merchants and Jiangxi JDL.
Diversification Opportunities for China Merchants and Jiangxi JDL
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Jiangxi is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding China Merchants Shekou and Jiangxi JDL Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi JDL Environmental and China Merchants 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 China Merchants Shekou are associated (or correlated) with Jiangxi JDL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi JDL Environmental has no effect on the direction of China Merchants i.e., China Merchants and Jiangxi JDL go up and down completely randomly.
Pair Corralation between China Merchants and Jiangxi JDL
Assuming the 90 days trading horizon China Merchants Shekou is expected to generate 1.23 times more return on investment than Jiangxi JDL. However, China Merchants is 1.23 times more volatile than Jiangxi JDL Environmental. It trades about 0.0 of its potential returns per unit of risk. Jiangxi JDL Environmental is currently generating about -0.07 per unit of risk. If you would invest 1,116 in China Merchants Shekou on August 29, 2024 and sell it today you would lose (10.00) from holding China Merchants Shekou or give up 0.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Merchants Shekou vs. Jiangxi JDL Environmental
Performance |
| Timeline |
| China Merchants Shekou |
| Jiangxi JDL Environmental |
China Merchants and Jiangxi JDL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Merchants and Jiangxi JDL
The main advantage of trading using opposite China Merchants and Jiangxi JDL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Merchants position performs unexpectedly, Jiangxi JDL 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 Jiangxi JDL will offset losses from the drop in Jiangxi JDL's long position.| China Merchants vs. China Nonferrous Metal | China Merchants vs. Jinhe Biotechnology Co | China Merchants vs. Zhejiang Yayi Metal | China Merchants vs. Gansu Yasheng Industrial |
| Jiangxi JDL vs. Kontour Medical Technology | Jiangxi JDL vs. Sino Medical Sciences | Jiangxi JDL vs. Arrow Home Group | Jiangxi JDL vs. Cofoe Medical Technology |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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