Correlation Between Hongrun Construction and Jinlong Machinery
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By analyzing existing cross correlation between Hongrun Construction Group and Jinlong Machinery Electronic, you can compare the effects of market volatilities on Hongrun Construction and Jinlong Machinery 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 Hongrun Construction with a short position of Jinlong Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hongrun Construction and Jinlong Machinery.
Diversification Opportunities for Hongrun Construction and Jinlong Machinery
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hongrun and Jinlong is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Hongrun Construction Group and Jinlong Machinery Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinlong Machinery and Hongrun Construction 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 Hongrun Construction Group are associated (or correlated) with Jinlong Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinlong Machinery has no effect on the direction of Hongrun Construction i.e., Hongrun Construction and Jinlong Machinery go up and down completely randomly.
Pair Corralation between Hongrun Construction and Jinlong Machinery
Assuming the 90 days trading horizon Hongrun Construction Group is expected to generate 0.84 times more return on investment than Jinlong Machinery. However, Hongrun Construction Group is 1.18 times less risky than Jinlong Machinery. It trades about 0.12 of its potential returns per unit of risk. Jinlong Machinery Electronic is currently generating about -0.41 per unit of risk. If you would invest 490.00 in Hongrun Construction Group on October 14, 2024 and sell it today you would earn a total of 34.00 from holding Hongrun Construction Group or generate 6.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hongrun Construction Group vs. Jinlong Machinery Electronic
Performance |
| Timeline |
| Hongrun Construction |
| Jinlong Machinery |
Hongrun Construction and Jinlong Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hongrun Construction and Jinlong Machinery
The main advantage of trading using opposite Hongrun Construction and Jinlong Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hongrun Construction position performs unexpectedly, Jinlong Machinery 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 Jinlong Machinery will offset losses from the drop in Jinlong Machinery's long position.| Hongrun Construction vs. Quectel Wireless Solutions | Hongrun Construction vs. Fibocom Wireless | Hongrun Construction vs. Hangzhou Arcvideo Technology | Hongrun Construction vs. Songz Automobile Air |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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