Correlation Between New Hope and Jinhe Biotechnology
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By analyzing existing cross correlation between New Hope Dairy and Jinhe Biotechnology Co, you can compare the effects of market volatilities on New Hope and Jinhe Biotechnology 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 New Hope with a short position of Jinhe Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Hope and Jinhe Biotechnology.
Diversification Opportunities for New Hope and Jinhe Biotechnology
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between New and Jinhe is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding New Hope Dairy and Jinhe Biotechnology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinhe Biotechnology and New Hope 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 New Hope Dairy are associated (or correlated) with Jinhe Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinhe Biotechnology has no effect on the direction of New Hope i.e., New Hope and Jinhe Biotechnology go up and down completely randomly.
Pair Corralation between New Hope and Jinhe Biotechnology
Assuming the 90 days trading horizon New Hope Dairy is expected to generate 1.2 times more return on investment than Jinhe Biotechnology. However, New Hope is 1.2 times more volatile than Jinhe Biotechnology Co. It trades about 0.07 of its potential returns per unit of risk. Jinhe Biotechnology Co is currently generating about -0.23 per unit of risk. If you would invest 1,489 in New Hope Dairy on October 12, 2024 and sell it today you would earn a total of 56.00 from holding New Hope Dairy or generate 3.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
New Hope Dairy vs. Jinhe Biotechnology Co
Performance |
| Timeline |
| New Hope Dairy |
| Jinhe Biotechnology |
New Hope and Jinhe Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New Hope and Jinhe Biotechnology
The main advantage of trading using opposite New Hope and Jinhe Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Hope position performs unexpectedly, Jinhe Biotechnology 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 Jinhe Biotechnology will offset losses from the drop in Jinhe Biotechnology's long position.| New Hope vs. Qingdao Foods Co | New Hope vs. Heilongjiang Publishing Media | New Hope vs. Guangdong Jinma Entertainment | New Hope vs. Anhui Xinhua Media |
| Jinhe Biotechnology vs. New Hope Dairy | Jinhe Biotechnology vs. Jinling Hotel Corp | Jinhe Biotechnology vs. Runjian Communication Co | Jinhe Biotechnology vs. Tongyu Communication |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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