Correlation Between Jiangsu Jinling and XCMG Construction
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By analyzing existing cross correlation between Jiangsu Jinling Sports and XCMG Construction Machinery, you can compare the effects of market volatilities on Jiangsu Jinling and XCMG Construction 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 Jiangsu Jinling with a short position of XCMG Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Jinling and XCMG Construction.
Diversification Opportunities for Jiangsu Jinling and XCMG Construction
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jiangsu and XCMG is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Jinling Sports and XCMG Construction Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XCMG Construction and Jiangsu Jinling 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 Jiangsu Jinling Sports are associated (or correlated) with XCMG Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XCMG Construction has no effect on the direction of Jiangsu Jinling i.e., Jiangsu Jinling and XCMG Construction go up and down completely randomly.
Pair Corralation between Jiangsu Jinling and XCMG Construction
Assuming the 90 days trading horizon Jiangsu Jinling is expected to generate 1.99 times less return on investment than XCMG Construction. In addition to that, Jiangsu Jinling is 1.46 times more volatile than XCMG Construction Machinery. It trades about 0.16 of its total potential returns per unit of risk. XCMG Construction Machinery is currently generating about 0.47 per unit of volatility. If you would invest 764.00 in XCMG Construction Machinery on November 28, 2024 and sell it today you would earn a total of 115.00 from holding XCMG Construction Machinery or generate 15.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
Jiangsu Jinling Sports vs. XCMG Construction Machinery
Performance |
| Timeline |
| Jiangsu Jinling Sports |
| XCMG Construction |
Jiangsu Jinling and XCMG Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Jinling and XCMG Construction
The main advantage of trading using opposite Jiangsu Jinling and XCMG Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Jinling position performs unexpectedly, XCMG Construction 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 XCMG Construction will offset losses from the drop in XCMG Construction's long position.| Jiangsu Jinling vs. Metro Investment Development | Jiangsu Jinling vs. Chinese Universe Publishing | Jiangsu Jinling vs. Duzhe Publishing Media | Jiangsu Jinling vs. Offshore Oil Engineering |
| XCMG Construction vs. iSoftStone Information Technology | XCMG Construction vs. Beijing Kaiwen Education | XCMG Construction vs. Tangel Publishing | XCMG Construction vs. Qtone Education Group |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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