Correlation Between Guangzhou Jointas and HeBei Jinniu
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By analyzing existing cross correlation between Guangzhou Jointas Chemical and HeBei Jinniu Chemical, you can compare the effects of market volatilities on Guangzhou Jointas and HeBei Jinniu 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 Jointas with a short position of HeBei Jinniu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Jointas and HeBei Jinniu.
Diversification Opportunities for Guangzhou Jointas and HeBei Jinniu
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangzhou and HeBei is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Jointas Chemical and HeBei Jinniu Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HeBei Jinniu Chemical and Guangzhou Jointas 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 Jointas Chemical are associated (or correlated) with HeBei Jinniu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HeBei Jinniu Chemical has no effect on the direction of Guangzhou Jointas i.e., Guangzhou Jointas and HeBei Jinniu go up and down completely randomly.
Pair Corralation between Guangzhou Jointas and HeBei Jinniu
Assuming the 90 days trading horizon Guangzhou Jointas Chemical is expected to under-perform the HeBei Jinniu. But the stock apears to be less risky and, when comparing its historical volatility, Guangzhou Jointas Chemical is 1.22 times less risky than HeBei Jinniu. The stock trades about -0.3 of its potential returns per unit of risk. The HeBei Jinniu Chemical is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 560.00 in HeBei Jinniu Chemical on October 16, 2024 and sell it today you would earn a total of 5.00 from holding HeBei Jinniu Chemical or generate 0.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Jointas Chemical vs. HeBei Jinniu Chemical
Performance |
| Timeline |
| Guangzhou Jointas |
| HeBei Jinniu Chemical |
Guangzhou Jointas and HeBei Jinniu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Jointas and HeBei Jinniu
The main advantage of trading using opposite Guangzhou Jointas and HeBei Jinniu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Jointas position performs unexpectedly, HeBei Jinniu 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 HeBei Jinniu will offset losses from the drop in HeBei Jinniu's long position.| Guangzhou Jointas vs. State Grid InformationCommunication | Guangzhou Jointas vs. Guangxi Wuzhou Communications | Guangzhou Jointas vs. Tieling Newcity Investment | Guangzhou Jointas vs. Dr Peng Telecom |
| HeBei Jinniu vs. Liaoning Dingjide Petrochemical | HeBei Jinniu vs. Yuanjie Semiconductor Technology | HeBei Jinniu vs. Guangzhou Jointas Chemical | HeBei Jinniu vs. Shenyang Chemical Industry |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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