Correlation Between Xiamen Jihong and Fujian Anjoy
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By analyzing existing cross correlation between Xiamen Jihong Package and Fujian Anjoy Foods, you can compare the effects of market volatilities on Xiamen Jihong and Fujian Anjoy 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 Xiamen Jihong with a short position of Fujian Anjoy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen Jihong and Fujian Anjoy.
Diversification Opportunities for Xiamen Jihong and Fujian Anjoy
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Xiamen and Fujian is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen Jihong Package and Fujian Anjoy Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Anjoy Foods and Xiamen Jihong 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 Xiamen Jihong Package are associated (or correlated) with Fujian Anjoy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Anjoy Foods has no effect on the direction of Xiamen Jihong i.e., Xiamen Jihong and Fujian Anjoy go up and down completely randomly.
Pair Corralation between Xiamen Jihong and Fujian Anjoy
Assuming the 90 days trading horizon Xiamen Jihong Package is expected to under-perform the Fujian Anjoy. In addition to that, Xiamen Jihong is 1.07 times more volatile than Fujian Anjoy Foods. It trades about -0.03 of its total potential returns per unit of risk. Fujian Anjoy Foods is currently generating about -0.01 per unit of volatility. If you would invest 11,375 in Fujian Anjoy Foods on September 14, 2024 and sell it today you would lose (1,944) from holding Fujian Anjoy Foods or give up 17.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen Jihong Package vs. Fujian Anjoy Foods
Performance |
| Timeline |
| Xiamen Jihong Package |
| Fujian Anjoy Foods |
Xiamen Jihong and Fujian Anjoy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen Jihong and Fujian Anjoy
The main advantage of trading using opposite Xiamen Jihong and Fujian Anjoy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen Jihong position performs unexpectedly, Fujian Anjoy 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 Fujian Anjoy will offset losses from the drop in Fujian Anjoy's long position.| Xiamen Jihong vs. Zijin Mining Group | Xiamen Jihong vs. Wanhua Chemical Group | Xiamen Jihong vs. Baoshan Iron Steel | Xiamen Jihong vs. Shandong Gold Mining |
| Fujian Anjoy vs. Jiangxi JDL Environmental | Fujian Anjoy vs. Hainan Haiqi Transportation | Fujian Anjoy vs. Changjiang Jinggong Steel | Fujian Anjoy vs. Anyang Iron Steel |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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