Correlation Between Shandong Longquan and Jiangnan Mould
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By analyzing existing cross correlation between Shandong Longquan Pipeline and Jiangnan Mould Plastic, you can compare the effects of market volatilities on Shandong Longquan and Jiangnan Mould 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 Shandong Longquan with a short position of Jiangnan Mould. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Longquan and Jiangnan Mould.
Diversification Opportunities for Shandong Longquan and Jiangnan Mould
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shandong and Jiangnan is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Longquan Pipeline and Jiangnan Mould Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangnan Mould Plastic and Shandong Longquan 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 Shandong Longquan Pipeline are associated (or correlated) with Jiangnan Mould. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangnan Mould Plastic has no effect on the direction of Shandong Longquan i.e., Shandong Longquan and Jiangnan Mould go up and down completely randomly.
Pair Corralation between Shandong Longquan and Jiangnan Mould
Assuming the 90 days trading horizon Shandong Longquan Pipeline is expected to generate 0.84 times more return on investment than Jiangnan Mould. However, Shandong Longquan Pipeline is 1.19 times less risky than Jiangnan Mould. It trades about 0.44 of its potential returns per unit of risk. Jiangnan Mould Plastic is currently generating about 0.21 per unit of risk. If you would invest 430.00 in Shandong Longquan Pipeline on November 5, 2024 and sell it today you would earn a total of 44.00 from holding Shandong Longquan Pipeline or generate 10.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Longquan Pipeline vs. Jiangnan Mould Plastic
Performance |
| Timeline |
| Shandong Longquan |
| Jiangnan Mould Plastic |
Shandong Longquan and Jiangnan Mould Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Longquan and Jiangnan Mould
The main advantage of trading using opposite Shandong Longquan and Jiangnan Mould positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Longquan position performs unexpectedly, Jiangnan Mould 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 Jiangnan Mould will offset losses from the drop in Jiangnan Mould's long position.| Shandong Longquan vs. Lander Sports Development | Shandong Longquan vs. Changjiang Publishing Media | Shandong Longquan vs. Threes Company Media | Shandong Longquan vs. Shandong Publishing Media |
| Jiangnan Mould vs. GRIPM Advanced Materials | Jiangnan Mould vs. Dezhan HealthCare Co | Jiangnan Mould vs. Yunnan Jianzhijia Health Chain | Jiangnan Mould vs. Advanced Technology Materials |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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