Correlation Between Jinhe Biotechnology and Long Yuan
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By analyzing existing cross correlation between Jinhe Biotechnology Co and Long Yuan Construction, you can compare the effects of market volatilities on Jinhe Biotechnology and Long Yuan 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 Long Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinhe Biotechnology and Long Yuan.
Diversification Opportunities for Jinhe Biotechnology and Long Yuan
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jinhe and Long is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Jinhe Biotechnology Co and Long Yuan Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Long Yuan Construction 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 Long Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Long Yuan Construction has no effect on the direction of Jinhe Biotechnology i.e., Jinhe Biotechnology and Long Yuan go up and down completely randomly.
Pair Corralation between Jinhe Biotechnology and Long Yuan
Assuming the 90 days trading horizon Jinhe Biotechnology is expected to generate 12.67 times less return on investment than Long Yuan. But when comparing it to its historical volatility, Jinhe Biotechnology Co is 1.61 times less risky than Long Yuan. It trades about 0.01 of its potential returns per unit of risk. Long Yuan Construction is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 320.00 in Long Yuan Construction on October 17, 2024 and sell it today you would earn a total of 29.00 from holding Long Yuan Construction or generate 9.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinhe Biotechnology Co vs. Long Yuan Construction
Performance |
| Timeline |
| Jinhe Biotechnology |
| Long Yuan Construction |
Jinhe Biotechnology and Long Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinhe Biotechnology and Long Yuan
The main advantage of trading using opposite Jinhe Biotechnology and Long Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinhe Biotechnology position performs unexpectedly, Long Yuan 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 Long Yuan will offset losses from the drop in Long Yuan's long position.| Jinhe Biotechnology vs. China Aluminum International | Jinhe Biotechnology vs. CICC Fund Management | Jinhe Biotechnology vs. Zhejiang Yongjin Metal | Jinhe Biotechnology vs. Yuanjie Semiconductor Technology |
| Long Yuan vs. Jinhe Biotechnology Co | Long Yuan vs. Hengkang Medical Group | Long Yuan vs. Maccura Biotechnology Co | Long Yuan vs. Liaoning Chengda Biotechnology |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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