Correlation Between Jinhe Biotechnology and China Southern
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By analyzing existing cross correlation between Jinhe Biotechnology Co and China Southern Airlines, you can compare the effects of market volatilities on Jinhe Biotechnology and China Southern 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 Jinhe Biotechnology with a short position of China Southern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinhe Biotechnology and China Southern.
Diversification Opportunities for Jinhe Biotechnology and China Southern
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jinhe and China is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Jinhe Biotechnology Co and China Southern Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Southern Airlines and Jinhe Biotechnology 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 Jinhe Biotechnology Co are associated (or correlated) with China Southern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Southern Airlines has no effect on the direction of Jinhe Biotechnology i.e., Jinhe Biotechnology and China Southern go up and down completely randomly.
Pair Corralation between Jinhe Biotechnology and China Southern
Assuming the 90 days trading horizon Jinhe Biotechnology is expected to generate 1.53 times less return on investment than China Southern. In addition to that, Jinhe Biotechnology is 1.45 times more volatile than China Southern Airlines. It trades about 0.01 of its total potential returns per unit of risk. China Southern Airlines is currently generating about 0.03 per unit of volatility. If you would invest 648.00 in China Southern Airlines on September 12, 2024 and sell it today you would earn a total of 76.00 from holding China Southern Airlines or generate 11.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinhe Biotechnology Co vs. China Southern Airlines
Performance |
| Timeline |
| Jinhe Biotechnology |
| China Southern Airlines |
Jinhe Biotechnology and China Southern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinhe Biotechnology and China Southern
The main advantage of trading using opposite Jinhe Biotechnology and China Southern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinhe Biotechnology position performs unexpectedly, China Southern 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 China Southern will offset losses from the drop in China Southern's long position.| Jinhe Biotechnology vs. Cultural Investment Holdings | Jinhe Biotechnology vs. Gome Telecom Equipment | Jinhe Biotechnology vs. Holitech Technology Co | Jinhe Biotechnology vs. Zotye Automobile Co |
| China Southern vs. Sinomach General Machinery | China Southern vs. Linzhou Heavy Machinery | China Southern vs. HanS Laser Tech | China Southern vs. Shenzhen Topway Video |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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