Correlation Between Muyuan Foodstuff and Joincare Pharmaceutical
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By analyzing existing cross correlation between Muyuan Foodstuff Co and Joincare Pharmaceutical Group, you can compare the effects of market volatilities on Muyuan Foodstuff and Joincare Pharmaceutical 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 Muyuan Foodstuff with a short position of Joincare Pharmaceutical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Muyuan Foodstuff and Joincare Pharmaceutical.
Diversification Opportunities for Muyuan Foodstuff and Joincare Pharmaceutical
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Muyuan and Joincare is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Muyuan Foodstuff Co and Joincare Pharmaceutical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Joincare Pharmaceutical and Muyuan Foodstuff 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 Muyuan Foodstuff Co are associated (or correlated) with Joincare Pharmaceutical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Joincare Pharmaceutical has no effect on the direction of Muyuan Foodstuff i.e., Muyuan Foodstuff and Joincare Pharmaceutical go up and down completely randomly.
Pair Corralation between Muyuan Foodstuff and Joincare Pharmaceutical
Assuming the 90 days trading horizon Muyuan Foodstuff Co is expected to under-perform the Joincare Pharmaceutical. In addition to that, Muyuan Foodstuff is 1.07 times more volatile than Joincare Pharmaceutical Group. It trades about -0.04 of its total potential returns per unit of risk. Joincare Pharmaceutical Group is currently generating about -0.02 per unit of volatility. If you would invest 1,243 in Joincare Pharmaceutical Group on September 12, 2024 and sell it today you would lose (88.00) from holding Joincare Pharmaceutical Group or give up 7.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.18% |
| Values | Daily Returns |
Muyuan Foodstuff Co vs. Joincare Pharmaceutical Group
Performance |
| Timeline |
| Muyuan Foodstuff |
| Joincare Pharmaceutical |
Muyuan Foodstuff and Joincare Pharmaceutical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Muyuan Foodstuff and Joincare Pharmaceutical
The main advantage of trading using opposite Muyuan Foodstuff and Joincare Pharmaceutical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Muyuan Foodstuff position performs unexpectedly, Joincare Pharmaceutical 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 Joincare Pharmaceutical will offset losses from the drop in Joincare Pharmaceutical's long position.| Muyuan Foodstuff vs. China Petroleum Chemical | Muyuan Foodstuff vs. PetroChina Co Ltd | Muyuan Foodstuff vs. China State Construction | Muyuan Foodstuff vs. China Railway Group |
| Joincare Pharmaceutical vs. Dalian Thermal Power | Joincare Pharmaceutical vs. Xinjiang Baodi Mining | Joincare Pharmaceutical vs. Shenyang Huitian Thermal | Joincare Pharmaceutical vs. Peoples Insurance of |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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