Correlation Between Jiajia Food and Shandong Ruifeng
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By analyzing existing cross correlation between Jiajia Food Group and Shandong Ruifeng Chemical, you can compare the effects of market volatilities on Jiajia Food and Shandong Ruifeng 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 Jiajia Food with a short position of Shandong Ruifeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiajia Food and Shandong Ruifeng.
Diversification Opportunities for Jiajia Food and Shandong Ruifeng
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiajia and Shandong is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Jiajia Food Group and Shandong Ruifeng Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Ruifeng Chemical and Jiajia Food 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 Jiajia Food Group are associated (or correlated) with Shandong Ruifeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Ruifeng Chemical has no effect on the direction of Jiajia Food i.e., Jiajia Food and Shandong Ruifeng go up and down completely randomly.
Pair Corralation between Jiajia Food and Shandong Ruifeng
Assuming the 90 days trading horizon Jiajia Food is expected to generate 2.45 times less return on investment than Shandong Ruifeng. But when comparing it to its historical volatility, Jiajia Food Group is 1.24 times less risky than Shandong Ruifeng. It trades about 0.02 of its potential returns per unit of risk. Shandong Ruifeng Chemical is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 874.00 in Shandong Ruifeng Chemical on September 3, 2024 and sell it today you would earn a total of 226.00 from holding Shandong Ruifeng Chemical or generate 25.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiajia Food Group vs. Shandong Ruifeng Chemical
Performance |
| Timeline |
| Jiajia Food Group |
| Shandong Ruifeng Chemical |
Jiajia Food and Shandong Ruifeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiajia Food and Shandong Ruifeng
The main advantage of trading using opposite Jiajia Food and Shandong Ruifeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiajia Food position performs unexpectedly, Shandong Ruifeng 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 Shandong Ruifeng will offset losses from the drop in Shandong Ruifeng's long position.| Jiajia Food vs. Beijing Wantai Biological | Jiajia Food vs. Aluminum Corp of | Jiajia Food vs. COL Digital Publishing | Jiajia Food vs. Shaanxi Meineng Clean |
| Shandong Ruifeng vs. Beijing Bashi Media | Shandong Ruifeng vs. Air China Ltd | Shandong Ruifeng vs. Inly Media Co | Shandong Ruifeng vs. Bus Online Co |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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