Correlation Between Jiangsu Jinling and Guangdong Liantai
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By analyzing existing cross correlation between Jiangsu Jinling Sports and Guangdong Liantai Environmental, you can compare the effects of market volatilities on Jiangsu Jinling and Guangdong Liantai 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 Guangdong Liantai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Jinling and Guangdong Liantai.
Diversification Opportunities for Jiangsu Jinling and Guangdong Liantai
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jiangsu and Guangdong is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Jinling Sports and Guangdong Liantai Environmenta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Liantai 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 Guangdong Liantai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Liantai has no effect on the direction of Jiangsu Jinling i.e., Jiangsu Jinling and Guangdong Liantai go up and down completely randomly.
Pair Corralation between Jiangsu Jinling and Guangdong Liantai
Assuming the 90 days trading horizon Jiangsu Jinling is expected to generate 1.23 times less return on investment than Guangdong Liantai. In addition to that, Jiangsu Jinling is 1.28 times more volatile than Guangdong Liantai Environmental. It trades about 0.04 of its total potential returns per unit of risk. Guangdong Liantai Environmental is currently generating about 0.06 per unit of volatility. If you would invest 430.00 in Guangdong Liantai Environmental on September 12, 2024 and sell it today you would earn a total of 9.00 from holding Guangdong Liantai Environmental or generate 2.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Jinling Sports vs. Guangdong Liantai Environmenta
Performance |
| Timeline |
| Jiangsu Jinling Sports |
| Guangdong Liantai |
Jiangsu Jinling and Guangdong Liantai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Jinling and Guangdong Liantai
The main advantage of trading using opposite Jiangsu Jinling and Guangdong Liantai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Jinling position performs unexpectedly, Guangdong Liantai 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 Guangdong Liantai will offset losses from the drop in Guangdong Liantai's long position.| Jiangsu Jinling vs. Lutian Machinery Co | Jiangsu Jinling vs. PetroChina Co Ltd | Jiangsu Jinling vs. Bank of China | Jiangsu Jinling vs. Gansu Jiu Steel |
| Guangdong Liantai vs. Agricultural Bank of | Guangdong Liantai vs. Industrial and Commercial | Guangdong Liantai vs. Bank of China | Guangdong Liantai vs. PetroChina Co Ltd |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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