Correlation Between Fujian Longzhou and Jinhui Liquor
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By analyzing existing cross correlation between Fujian Longzhou Transportation and Jinhui Liquor Co, you can compare the effects of market volatilities on Fujian Longzhou and Jinhui Liquor 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 Fujian Longzhou with a short position of Jinhui Liquor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Longzhou and Jinhui Liquor.
Diversification Opportunities for Fujian Longzhou and Jinhui Liquor
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fujian and Jinhui is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Longzhou Transportation and Jinhui Liquor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinhui Liquor and Fujian Longzhou 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 Fujian Longzhou Transportation are associated (or correlated) with Jinhui Liquor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinhui Liquor has no effect on the direction of Fujian Longzhou i.e., Fujian Longzhou and Jinhui Liquor go up and down completely randomly.
Pair Corralation between Fujian Longzhou and Jinhui Liquor
Assuming the 90 days trading horizon Fujian Longzhou Transportation is expected to generate 2.23 times more return on investment than Jinhui Liquor. However, Fujian Longzhou is 2.23 times more volatile than Jinhui Liquor Co. It trades about 0.17 of its potential returns per unit of risk. Jinhui Liquor Co is currently generating about -0.11 per unit of risk. If you would invest 495.00 in Fujian Longzhou Transportation on September 13, 2024 and sell it today you would earn a total of 73.00 from holding Fujian Longzhou Transportation or generate 14.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Longzhou Transportation vs. Jinhui Liquor Co
Performance |
| Timeline |
| Fujian Longzhou Tran |
| Jinhui Liquor |
Fujian Longzhou and Jinhui Liquor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Longzhou and Jinhui Liquor
The main advantage of trading using opposite Fujian Longzhou and Jinhui Liquor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Longzhou position performs unexpectedly, Jinhui Liquor 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 Jinhui Liquor will offset losses from the drop in Jinhui Liquor's long position.| Fujian Longzhou vs. Aofu Environmental Technology | Fujian Longzhou vs. Dongjiang Environmental Co | Fujian Longzhou vs. Allied Machinery Co | Fujian Longzhou vs. Nanxing Furniture Machinery |
| Jinhui Liquor vs. China Life Insurance | Jinhui Liquor vs. Cinda Securities Co | Jinhui Liquor vs. Piotech Inc A | Jinhui Liquor vs. Dongxing Sec 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 Stocks Directory module to find actively traded stocks across global markets.
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