Correlation Between Longxing Chemical and Jilin Jlu
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By analyzing existing cross correlation between Longxing Chemical Stock and Jilin Jlu Communication, you can compare the effects of market volatilities on Longxing Chemical and Jilin Jlu 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 Longxing Chemical with a short position of Jilin Jlu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Longxing Chemical and Jilin Jlu.
Diversification Opportunities for Longxing Chemical and Jilin Jlu
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Longxing and Jilin is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Longxing Chemical Stock and Jilin Jlu Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jilin Jlu Communication and Longxing Chemical 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 Longxing Chemical Stock are associated (or correlated) with Jilin Jlu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jilin Jlu Communication has no effect on the direction of Longxing Chemical i.e., Longxing Chemical and Jilin Jlu go up and down completely randomly.
Pair Corralation between Longxing Chemical and Jilin Jlu
Assuming the 90 days trading horizon Longxing Chemical Stock is expected to generate 0.84 times more return on investment than Jilin Jlu. However, Longxing Chemical Stock is 1.19 times less risky than Jilin Jlu. It trades about 0.03 of its potential returns per unit of risk. Jilin Jlu Communication is currently generating about 0.02 per unit of risk. If you would invest 479.00 in Longxing Chemical Stock on January 24, 2025 and sell it today you would earn a total of 140.00 from holding Longxing Chemical Stock or generate 29.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Longxing Chemical Stock vs. Jilin Jlu Communication
Performance |
| Timeline |
| Longxing Chemical Stock |
| Jilin Jlu Communication |
Longxing Chemical and Jilin Jlu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Longxing Chemical and Jilin Jlu
The main advantage of trading using opposite Longxing Chemical and Jilin Jlu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Longxing Chemical position performs unexpectedly, Jilin Jlu 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 Jilin Jlu will offset losses from the drop in Jilin Jlu's long position.| Longxing Chemical vs. Easyhome New Retail | Longxing Chemical vs. Yonyou Auto Information | Longxing Chemical vs. Winner Information Technology | Longxing Chemical vs. Wuhan PS Information |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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