Correlation Between Jiangxi Ganfeng and Zhejiang Huayou
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By analyzing existing cross correlation between Jiangxi Ganfeng Lithium and Zhejiang Huayou Cobalt, you can compare the effects of market volatilities on Jiangxi Ganfeng and Zhejiang Huayou 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 Zhejiang Huayou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangxi Ganfeng and Zhejiang Huayou.
Diversification Opportunities for Jiangxi Ganfeng and Zhejiang Huayou
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiangxi and Zhejiang is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Jiangxi Ganfeng Lithium and Zhejiang Huayou Cobalt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Huayou Cobalt 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 Zhejiang Huayou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Huayou Cobalt has no effect on the direction of Jiangxi Ganfeng i.e., Jiangxi Ganfeng and Zhejiang Huayou go up and down completely randomly.
Pair Corralation between Jiangxi Ganfeng and Zhejiang Huayou
Assuming the 90 days trading horizon Jiangxi Ganfeng Lithium is expected to generate 1.08 times more return on investment than Zhejiang Huayou. However, Jiangxi Ganfeng is 1.08 times more volatile than Zhejiang Huayou Cobalt. It trades about -0.05 of its potential returns per unit of risk. Zhejiang Huayou Cobalt is currently generating about -0.05 per unit of risk. If you would invest 7,574 in Jiangxi Ganfeng Lithium on October 16, 2024 and sell it today you would lose (4,140) from holding Jiangxi Ganfeng Lithium or give up 54.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangxi Ganfeng Lithium vs. Zhejiang Huayou Cobalt
Performance |
| Timeline |
| Jiangxi Ganfeng Lithium |
| Zhejiang Huayou Cobalt |
Jiangxi Ganfeng and Zhejiang Huayou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangxi Ganfeng and Zhejiang Huayou
The main advantage of trading using opposite Jiangxi Ganfeng and Zhejiang Huayou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangxi Ganfeng position performs unexpectedly, Zhejiang Huayou 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 Zhejiang Huayou will offset losses from the drop in Zhejiang Huayou's long position.| Jiangxi Ganfeng vs. JiShi Media Co | Jiangxi Ganfeng vs. Beijing Enlight Media | Jiangxi Ganfeng vs. Luyin Investment Group | Jiangxi Ganfeng vs. Changjiang Publishing Media |
| Zhejiang Huayou vs. Zijin Mining Group | Zhejiang Huayou vs. Wanhua Chemical Group | Zhejiang Huayou vs. Baoshan Iron Steel | Zhejiang Huayou 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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