Correlation Between Jiangsu Jinling and Weichai Heavy
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By analyzing existing cross correlation between Jiangsu Jinling Sports and Weichai Heavy Machinery, you can compare the effects of market volatilities on Jiangsu Jinling and Weichai Heavy 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 Weichai Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Jinling and Weichai Heavy.
Diversification Opportunities for Jiangsu Jinling and Weichai Heavy
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiangsu and Weichai is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Jinling Sports and Weichai Heavy Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weichai Heavy Machinery 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 Weichai Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weichai Heavy Machinery has no effect on the direction of Jiangsu Jinling i.e., Jiangsu Jinling and Weichai Heavy go up and down completely randomly.
Pair Corralation between Jiangsu Jinling and Weichai Heavy
Assuming the 90 days trading horizon Jiangsu Jinling Sports is expected to under-perform the Weichai Heavy. But the stock apears to be less risky and, when comparing its historical volatility, Jiangsu Jinling Sports is 2.28 times less risky than Weichai Heavy. The stock trades about 0.0 of its potential returns per unit of risk. The Weichai Heavy Machinery is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,050 in Weichai Heavy Machinery on August 25, 2024 and sell it today you would earn a total of 134.00 from holding Weichai Heavy Machinery or generate 12.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Jinling Sports vs. Weichai Heavy Machinery
Performance |
| Timeline |
| Jiangsu Jinling Sports |
| Weichai Heavy Machinery |
Jiangsu Jinling and Weichai Heavy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Jinling and Weichai Heavy
The main advantage of trading using opposite Jiangsu Jinling and Weichai Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Jinling position performs unexpectedly, Weichai Heavy 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 Weichai Heavy will offset losses from the drop in Weichai Heavy's long position.| Jiangsu Jinling vs. Kweichow Moutai Co | Jiangsu Jinling vs. Contemporary Amperex Technology | Jiangsu Jinling vs. G bits Network Technology | Jiangsu Jinling vs. Beijing Roborock Technology |
| Weichai Heavy vs. Shenzhen Topway Video | Weichai Heavy vs. Vanfund Urban Investment | Weichai Heavy vs. Nantong Haixing Electronics | Weichai Heavy vs. Zoje Resources Investment |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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