Correlation Between BYD Co and Jinlong Machinery
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By analyzing existing cross correlation between BYD Co Ltd and Jinlong Machinery Electronic, you can compare the effects of market volatilities on BYD Co and Jinlong Machinery 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 BYD Co with a short position of Jinlong Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of BYD Co and Jinlong Machinery.
Diversification Opportunities for BYD Co and Jinlong Machinery
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BYD and Jinlong is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding BYD Co Ltd and Jinlong Machinery Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinlong Machinery and BYD Co 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 BYD Co Ltd are associated (or correlated) with Jinlong Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinlong Machinery has no effect on the direction of BYD Co i.e., BYD Co and Jinlong Machinery go up and down completely randomly.
Pair Corralation between BYD Co and Jinlong Machinery
Assuming the 90 days trading horizon BYD Co is expected to generate 2.97 times less return on investment than Jinlong Machinery. But when comparing it to its historical volatility, BYD Co Ltd is 2.0 times less risky than Jinlong Machinery. It trades about 0.0 of its potential returns per unit of risk. Jinlong Machinery Electronic is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 542.00 in Jinlong Machinery Electronic on October 25, 2024 and sell it today you would lose (110.00) from holding Jinlong Machinery Electronic or give up 20.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BYD Co Ltd vs. Jinlong Machinery Electronic
Performance |
| Timeline |
| BYD Co |
| Jinlong Machinery |
BYD Co and Jinlong Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BYD Co and Jinlong Machinery
The main advantage of trading using opposite BYD Co and Jinlong Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BYD Co position performs unexpectedly, Jinlong Machinery 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 Jinlong Machinery will offset losses from the drop in Jinlong Machinery's long position.| BYD Co vs. Huaxia Fund Management | BYD Co vs. Sinomach Automobile Co | BYD Co vs. Guangzhou Restaurants Group | BYD Co vs. Jiangsu Xinri E Vehicle |
| Jinlong Machinery vs. China State Construction | Jinlong Machinery vs. Poly Real Estate | Jinlong Machinery vs. China Vanke Co | Jinlong Machinery vs. China Merchants Shekou |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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