Correlation Between Guangzhou KDT and Jiangsu Financial
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By analyzing existing cross correlation between Guangzhou KDT Machinery and Jiangsu Financial Leasing, you can compare the effects of market volatilities on Guangzhou KDT and Jiangsu Financial 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 Guangzhou KDT with a short position of Jiangsu Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou KDT and Jiangsu Financial.
Diversification Opportunities for Guangzhou KDT and Jiangsu Financial
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Guangzhou and Jiangsu is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou KDT Machinery and Jiangsu Financial Leasing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Financial Leasing and Guangzhou KDT 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 Guangzhou KDT Machinery are associated (or correlated) with Jiangsu Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Financial Leasing has no effect on the direction of Guangzhou KDT i.e., Guangzhou KDT and Jiangsu Financial go up and down completely randomly.
Pair Corralation between Guangzhou KDT and Jiangsu Financial
Assuming the 90 days trading horizon Guangzhou KDT Machinery is expected to under-perform the Jiangsu Financial. In addition to that, Guangzhou KDT is 1.2 times more volatile than Jiangsu Financial Leasing. It trades about -0.47 of its total potential returns per unit of risk. Jiangsu Financial Leasing is currently generating about -0.04 per unit of volatility. If you would invest 514.00 in Jiangsu Financial Leasing on October 12, 2024 and sell it today you would lose (6.00) from holding Jiangsu Financial Leasing or give up 1.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou KDT Machinery vs. Jiangsu Financial Leasing
Performance |
| Timeline |
| Guangzhou KDT Machinery |
| Jiangsu Financial Leasing |
Guangzhou KDT and Jiangsu Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou KDT and Jiangsu Financial
The main advantage of trading using opposite Guangzhou KDT and Jiangsu Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou KDT position performs unexpectedly, Jiangsu Financial 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 Jiangsu Financial will offset losses from the drop in Jiangsu Financial's long position.| Guangzhou KDT vs. Elite Color Environmental | Guangzhou KDT vs. Central Plains Environment | Guangzhou KDT vs. Changjiang Jinggong Steel | Guangzhou KDT vs. Hangzhou Guotai Environmental |
| Jiangsu Financial vs. Oppein Home Group | Jiangsu Financial vs. Central Plains Environment | Jiangsu Financial vs. Tongxing Environmental Protection | Jiangsu Financial vs. Shandong Homey Aquatic |
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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