Correlation Between Guizhou Chanhen and Jilin Jlu
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By analyzing existing cross correlation between Guizhou Chanhen Chemical and Jilin Jlu Communication, you can compare the effects of market volatilities on Guizhou Chanhen and Jilin Jlu 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 Guizhou Chanhen with a short position of Jilin Jlu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guizhou Chanhen and Jilin Jlu.
Diversification Opportunities for Guizhou Chanhen and Jilin Jlu
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Guizhou and Jilin is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Guizhou Chanhen Chemical and Jilin Jlu Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jilin Jlu Communication and Guizhou Chanhen 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 Guizhou Chanhen Chemical are associated (or correlated) with Jilin Jlu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jilin Jlu Communication has no effect on the direction of Guizhou Chanhen i.e., Guizhou Chanhen and Jilin Jlu go up and down completely randomly.
Pair Corralation between Guizhou Chanhen and Jilin Jlu
Assuming the 90 days trading horizon Guizhou Chanhen Chemical is expected to generate 0.75 times more return on investment than Jilin Jlu. However, Guizhou Chanhen Chemical is 1.34 times less risky than Jilin Jlu. It trades about -0.02 of its potential returns per unit of risk. Jilin Jlu Communication is currently generating about -0.02 per unit of risk. If you would invest 2,257 in Guizhou Chanhen Chemical on October 26, 2024 and sell it today you would lose (97.00) from holding Guizhou Chanhen Chemical or give up 4.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guizhou Chanhen Chemical vs. Jilin Jlu Communication
Performance |
| Timeline |
| Guizhou Chanhen Chemical |
| Jilin Jlu Communication |
Guizhou Chanhen and Jilin Jlu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guizhou Chanhen and Jilin Jlu
The main advantage of trading using opposite Guizhou Chanhen and Jilin Jlu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guizhou Chanhen position performs unexpectedly, Jilin Jlu 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 Jilin Jlu will offset losses from the drop in Jilin Jlu's long position.| Guizhou Chanhen vs. Zijin Mining Group | Guizhou Chanhen vs. Wanhua Chemical Group | Guizhou Chanhen vs. Baoshan Iron Steel | Guizhou Chanhen vs. Shandong Gold Mining |
| Jilin Jlu vs. Industrial and Commercial | Jilin Jlu vs. China Construction Bank | Jilin Jlu vs. Agricultural Bank of | Jilin Jlu vs. Bank of China |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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