Correlation Between Jiangsu Jinling and Sinosteel Luonai
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By analyzing existing cross correlation between Jiangsu Jinling Sports and Sinosteel Luonai Materials, you can compare the effects of market volatilities on Jiangsu Jinling and Sinosteel Luonai 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 Sinosteel Luonai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Jinling and Sinosteel Luonai.
Diversification Opportunities for Jiangsu Jinling and Sinosteel Luonai
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jiangsu and Sinosteel is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Jinling Sports and Sinosteel Luonai Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinosteel Luonai Mat 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 Sinosteel Luonai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinosteel Luonai Mat has no effect on the direction of Jiangsu Jinling i.e., Jiangsu Jinling and Sinosteel Luonai go up and down completely randomly.
Pair Corralation between Jiangsu Jinling and Sinosteel Luonai
Assuming the 90 days trading horizon Jiangsu Jinling Sports is expected to generate 0.89 times more return on investment than Sinosteel Luonai. However, Jiangsu Jinling Sports is 1.12 times less risky than Sinosteel Luonai. It trades about 0.07 of its potential returns per unit of risk. Sinosteel Luonai Materials is currently generating about 0.04 per unit of risk. If you would invest 1,375 in Jiangsu Jinling Sports on August 29, 2024 and sell it today you would earn a total of 40.00 from holding Jiangsu Jinling Sports or generate 2.91% 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. Sinosteel Luonai Materials
Performance |
| Timeline |
| Jiangsu Jinling Sports |
| Sinosteel Luonai Mat |
Jiangsu Jinling and Sinosteel Luonai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Jinling and Sinosteel Luonai
The main advantage of trading using opposite Jiangsu Jinling and Sinosteel Luonai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Jinling position performs unexpectedly, Sinosteel Luonai 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 Sinosteel Luonai will offset losses from the drop in Sinosteel Luonai's long position.| Jiangsu Jinling vs. Shenzhen MYS Environmental | Jiangsu Jinling vs. AVIC Fund Management | Jiangsu Jinling vs. Shenzhen Bingchuan Network | Jiangsu Jinling vs. Penghua Shenzhen Energy |
| Sinosteel Luonai vs. Zijin Mining Group | Sinosteel Luonai vs. Wanhua Chemical Group | Sinosteel Luonai vs. Baoshan Iron Steel | Sinosteel Luonai vs. Shandong Gold Mining |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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