Correlation Between Jiangsu Jinling and SI-TECH Information
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By analyzing existing cross correlation between Jiangsu Jinling Sports and SI TECH Information Technology, you can compare the effects of market volatilities on Jiangsu Jinling and SI-TECH Information 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 SI-TECH Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Jinling and SI-TECH Information.
Diversification Opportunities for Jiangsu Jinling and SI-TECH Information
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiangsu and SI-TECH is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Jinling Sports and SI TECH Information Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SI TECH Information 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 SI-TECH Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SI TECH Information has no effect on the direction of Jiangsu Jinling i.e., Jiangsu Jinling and SI-TECH Information go up and down completely randomly.
Pair Corralation between Jiangsu Jinling and SI-TECH Information
Assuming the 90 days trading horizon Jiangsu Jinling is expected to generate 2.62 times less return on investment than SI-TECH Information. But when comparing it to its historical volatility, Jiangsu Jinling Sports is 2.48 times less risky than SI-TECH Information. It trades about 0.24 of its potential returns per unit of risk. SI TECH Information Technology is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 996.00 in SI TECH Information Technology on November 7, 2024 and sell it today you would earn a total of 234.00 from holding SI TECH Information Technology or generate 23.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Jinling Sports vs. SI TECH Information Technology
Performance |
| Timeline |
| Jiangsu Jinling Sports |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| SI TECH Information |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Jiangsu Jinling and SI-TECH Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Jinling and SI-TECH Information
The main advantage of trading using opposite Jiangsu Jinling and SI-TECH Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Jinling position performs unexpectedly, SI-TECH Information 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 SI-TECH Information will offset losses from the drop in SI-TECH Information's long position.The idea behind Jiangsu Jinling Sports and SI TECH Information Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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