Correlation Between Jinlong Machinery and China Satellite
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By analyzing existing cross correlation between Jinlong Machinery Electronic and China Satellite Communications, you can compare the effects of market volatilities on Jinlong Machinery and China Satellite 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 Jinlong Machinery with a short position of China Satellite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinlong Machinery and China Satellite.
Diversification Opportunities for Jinlong Machinery and China Satellite
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jinlong and China is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Jinlong Machinery Electronic and China Satellite Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Satellite Comm and Jinlong Machinery 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 Jinlong Machinery Electronic are associated (or correlated) with China Satellite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Satellite Comm has no effect on the direction of Jinlong Machinery i.e., Jinlong Machinery and China Satellite go up and down completely randomly.
Pair Corralation between Jinlong Machinery and China Satellite
Assuming the 90 days trading horizon Jinlong Machinery Electronic is expected to under-perform the China Satellite. In addition to that, Jinlong Machinery is 1.5 times more volatile than China Satellite Communications. It trades about -0.25 of its total potential returns per unit of risk. China Satellite Communications is currently generating about -0.26 per unit of volatility. If you would invest 2,308 in China Satellite Communications on October 17, 2024 and sell it today you would lose (316.00) from holding China Satellite Communications or give up 13.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinlong Machinery Electronic vs. China Satellite Communications
Performance |
| Timeline |
| Jinlong Machinery |
| China Satellite Comm |
Jinlong Machinery and China Satellite Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinlong Machinery and China Satellite
The main advantage of trading using opposite Jinlong Machinery and China Satellite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinlong Machinery position performs unexpectedly, China Satellite 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 China Satellite will offset losses from the drop in China Satellite's long position.| Jinlong Machinery vs. Sichuan Yahua Industrial | Jinlong Machinery vs. Universal Scientific Industrial | Jinlong Machinery vs. Rising Nonferrous Metals | Jinlong Machinery vs. Harbin Air Conditioning |
| China Satellite vs. Nanxing Furniture Machinery | China Satellite vs. Huasi Agricultural Development | China Satellite vs. Ningbo Construction Co | China Satellite vs. Jinlong Machinery Electronic |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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