Correlation Between Jiangxi Ganfeng and Jinduicheng Molybdenum
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By analyzing existing cross correlation between Jiangxi Ganfeng Lithium and Jinduicheng Molybdenum Co, you can compare the effects of market volatilities on Jiangxi Ganfeng and Jinduicheng Molybdenum 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 Jiangxi Ganfeng with a short position of Jinduicheng Molybdenum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangxi Ganfeng and Jinduicheng Molybdenum.
Diversification Opportunities for Jiangxi Ganfeng and Jinduicheng Molybdenum
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiangxi and Jinduicheng is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Jiangxi Ganfeng Lithium and Jinduicheng Molybdenum Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinduicheng Molybdenum and Jiangxi Ganfeng 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 Jiangxi Ganfeng Lithium are associated (or correlated) with Jinduicheng Molybdenum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinduicheng Molybdenum has no effect on the direction of Jiangxi Ganfeng i.e., Jiangxi Ganfeng and Jinduicheng Molybdenum go up and down completely randomly.
Pair Corralation between Jiangxi Ganfeng and Jinduicheng Molybdenum
Assuming the 90 days trading horizon Jiangxi Ganfeng Lithium is expected to generate 2.25 times more return on investment than Jinduicheng Molybdenum. However, Jiangxi Ganfeng is 2.25 times more volatile than Jinduicheng Molybdenum Co. It trades about 0.19 of its potential returns per unit of risk. Jinduicheng Molybdenum Co is currently generating about 0.07 per unit of risk. If you would invest 2,660 in Jiangxi Ganfeng Lithium on September 3, 2024 and sell it today you would earn a total of 1,545 from holding Jiangxi Ganfeng Lithium or generate 58.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangxi Ganfeng Lithium vs. Jinduicheng Molybdenum Co
Performance |
| Timeline |
| Jiangxi Ganfeng Lithium |
| Jinduicheng Molybdenum |
Jiangxi Ganfeng and Jinduicheng Molybdenum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangxi Ganfeng and Jinduicheng Molybdenum
The main advantage of trading using opposite Jiangxi Ganfeng and Jinduicheng Molybdenum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangxi Ganfeng position performs unexpectedly, Jinduicheng Molybdenum 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 Jinduicheng Molybdenum will offset losses from the drop in Jinduicheng Molybdenum's long position.| Jiangxi Ganfeng vs. Dymatic Chemicals | Jiangxi Ganfeng vs. Yingde Greatchem Chemicals | Jiangxi Ganfeng vs. Ningxia Younglight Chemicals | Jiangxi Ganfeng vs. Shandong Polymer Biochemicals |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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