Correlation Between Jilin Jlu and Hengdian Entertainment
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By analyzing existing cross correlation between Jilin Jlu Communication and Hengdian Entertainment Co, you can compare the effects of market volatilities on Jilin Jlu and Hengdian Entertainment 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 Jilin Jlu with a short position of Hengdian Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jilin Jlu and Hengdian Entertainment.
Diversification Opportunities for Jilin Jlu and Hengdian Entertainment
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jilin and Hengdian is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Jilin Jlu Communication and Hengdian Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hengdian Entertainment and Jilin Jlu 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 Jilin Jlu Communication are associated (or correlated) with Hengdian Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hengdian Entertainment has no effect on the direction of Jilin Jlu i.e., Jilin Jlu and Hengdian Entertainment go up and down completely randomly.
Pair Corralation between Jilin Jlu and Hengdian Entertainment
Assuming the 90 days trading horizon Jilin Jlu Communication is expected to generate 1.0 times more return on investment than Hengdian Entertainment. However, Jilin Jlu is 1.0 times more volatile than Hengdian Entertainment Co. It trades about 0.02 of its potential returns per unit of risk. Hengdian Entertainment Co is currently generating about 0.01 per unit of risk. If you would invest 817.00 in Jilin Jlu Communication on October 16, 2024 and sell it today you would earn a total of 15.00 from holding Jilin Jlu Communication or generate 1.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jilin Jlu Communication vs. Hengdian Entertainment Co
Performance |
| Timeline |
| Jilin Jlu Communication |
| Hengdian Entertainment |
Jilin Jlu and Hengdian Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jilin Jlu and Hengdian Entertainment
The main advantage of trading using opposite Jilin Jlu and Hengdian Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jilin Jlu position performs unexpectedly, Hengdian Entertainment 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 Hengdian Entertainment will offset losses from the drop in Hengdian Entertainment's long position.| Jilin Jlu vs. Ziel Home Furnishing | Jilin Jlu vs. Anhui Deli Household | Jilin Jlu vs. Marssenger Kitchenware Co | Jilin Jlu vs. Shanghai Shuixing Home |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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