Correlation Between Jiangxi Ganfeng and Sichuan Hebang
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By analyzing existing cross correlation between Jiangxi Ganfeng Lithium and Sichuan Hebang Biotechnology, you can compare the effects of market volatilities on Jiangxi Ganfeng and Sichuan Hebang 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 Sichuan Hebang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangxi Ganfeng and Sichuan Hebang.
Diversification Opportunities for Jiangxi Ganfeng and Sichuan Hebang
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiangxi and Sichuan is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Jiangxi Ganfeng Lithium and Sichuan Hebang Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Hebang Biote 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 Sichuan Hebang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Hebang Biote has no effect on the direction of Jiangxi Ganfeng i.e., Jiangxi Ganfeng and Sichuan Hebang go up and down completely randomly.
Pair Corralation between Jiangxi Ganfeng and Sichuan Hebang
Assuming the 90 days trading horizon Jiangxi Ganfeng Lithium is expected to generate 2.7 times more return on investment than Sichuan Hebang. However, Jiangxi Ganfeng is 2.7 times more volatile than Sichuan Hebang Biotechnology. It trades about 0.23 of its potential returns per unit of risk. Sichuan Hebang Biotechnology is currently generating about -0.04 per unit of risk. If you would invest 3,398 in Jiangxi Ganfeng Lithium on September 1, 2024 and sell it today you would earn a total of 807.00 from holding Jiangxi Ganfeng Lithium or generate 23.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangxi Ganfeng Lithium vs. Sichuan Hebang Biotechnology
Performance |
| Timeline |
| Jiangxi Ganfeng Lithium |
| Sichuan Hebang Biote |
Jiangxi Ganfeng and Sichuan Hebang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangxi Ganfeng and Sichuan Hebang
The main advantage of trading using opposite Jiangxi Ganfeng and Sichuan Hebang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangxi Ganfeng position performs unexpectedly, Sichuan Hebang 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 Sichuan Hebang will offset losses from the drop in Sichuan Hebang's long position.| Jiangxi Ganfeng vs. China Minmetals Rare | Jiangxi Ganfeng vs. Shenzhen Kexin Communication | Jiangxi Ganfeng vs. Pengxin International Mining | Jiangxi Ganfeng vs. Guangdong Shenglu Telecommunication |
| Sichuan Hebang vs. Zijin Mining Group | Sichuan Hebang vs. Wanhua Chemical Group | Sichuan Hebang vs. Baoshan Iron Steel | Sichuan Hebang vs. Shandong Gold Mining |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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