Correlation Between Jiangsu Yanghe and Railway Signal
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By analyzing existing cross correlation between Jiangsu Yanghe Brewery and Railway Signal Communication, you can compare the effects of market volatilities on Jiangsu Yanghe and Railway Signal 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 Jiangsu Yanghe with a short position of Railway Signal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Yanghe and Railway Signal.
Diversification Opportunities for Jiangsu Yanghe and Railway Signal
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiangsu and Railway is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Yanghe Brewery and Railway Signal Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Railway Signal Commu and Jiangsu Yanghe 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 Jiangsu Yanghe Brewery are associated (or correlated) with Railway Signal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Railway Signal Commu has no effect on the direction of Jiangsu Yanghe i.e., Jiangsu Yanghe and Railway Signal go up and down completely randomly.
Pair Corralation between Jiangsu Yanghe and Railway Signal
Assuming the 90 days trading horizon Jiangsu Yanghe Brewery is expected to generate 0.74 times more return on investment than Railway Signal. However, Jiangsu Yanghe Brewery is 1.35 times less risky than Railway Signal. It trades about -0.17 of its potential returns per unit of risk. Railway Signal Communication is currently generating about -0.3 per unit of risk. If you would invest 8,367 in Jiangsu Yanghe Brewery on October 17, 2024 and sell it today you would lose (370.00) from holding Jiangsu Yanghe Brewery or give up 4.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Yanghe Brewery vs. Railway Signal Communication
Performance |
| Timeline |
| Jiangsu Yanghe Brewery |
| Railway Signal Commu |
Jiangsu Yanghe and Railway Signal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Yanghe and Railway Signal
The main advantage of trading using opposite Jiangsu Yanghe and Railway Signal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Yanghe position performs unexpectedly, Railway Signal 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 Railway Signal will offset losses from the drop in Railway Signal's long position.| Jiangsu Yanghe vs. Beijing Mainstreets Investment | Jiangsu Yanghe vs. Harbin Hatou Investment | Jiangsu Yanghe vs. Jinhe Biotechnology Co | Jiangsu Yanghe vs. Bloomage Biotechnology Corp |
| Railway Signal vs. Jiangsu Yanghe Brewery | Railway Signal vs. Gifore Agricultural Machinery | Railway Signal vs. Porton Fine Chemicals | Railway Signal vs. Hongrun Construction Group |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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