Correlation Between Chengdu Kanghua and Jiangsu Seagull
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By analyzing existing cross correlation between Chengdu Kanghua Biological and Jiangsu Seagull Cooling, you can compare the effects of market volatilities on Chengdu Kanghua and Jiangsu Seagull 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 Chengdu Kanghua with a short position of Jiangsu Seagull. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Kanghua and Jiangsu Seagull.
Diversification Opportunities for Chengdu Kanghua and Jiangsu Seagull
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chengdu and Jiangsu is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Kanghua Biological and Jiangsu Seagull Cooling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Seagull Cooling and Chengdu Kanghua 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 Chengdu Kanghua Biological are associated (or correlated) with Jiangsu Seagull. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Seagull Cooling has no effect on the direction of Chengdu Kanghua i.e., Chengdu Kanghua and Jiangsu Seagull go up and down completely randomly.
Pair Corralation between Chengdu Kanghua and Jiangsu Seagull
Assuming the 90 days trading horizon Chengdu Kanghua Biological is expected to generate 0.8 times more return on investment than Jiangsu Seagull. However, Chengdu Kanghua Biological is 1.25 times less risky than Jiangsu Seagull. It trades about 0.01 of its potential returns per unit of risk. Jiangsu Seagull Cooling is currently generating about -0.01 per unit of risk. If you would invest 6,380 in Chengdu Kanghua Biological on September 26, 2024 and sell it today you would lose (583.00) from holding Chengdu Kanghua Biological or give up 9.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Kanghua Biological vs. Jiangsu Seagull Cooling
Performance |
| Timeline |
| Chengdu Kanghua Biol |
| Jiangsu Seagull Cooling |
Chengdu Kanghua and Jiangsu Seagull Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Kanghua and Jiangsu Seagull
The main advantage of trading using opposite Chengdu Kanghua and Jiangsu Seagull positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Kanghua position performs unexpectedly, Jiangsu Seagull 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 Jiangsu Seagull will offset losses from the drop in Jiangsu Seagull's long position.| Chengdu Kanghua vs. Industrial and Commercial | Chengdu Kanghua vs. Agricultural Bank of | Chengdu Kanghua vs. China Construction Bank | Chengdu Kanghua vs. Bank of China |
| Jiangsu Seagull vs. Chengdu Kanghua Biological | Jiangsu Seagull vs. Beijing Wantai Biological | Jiangsu Seagull vs. Suzhou Novoprotein Scientific | Jiangsu Seagull vs. Aluminum Corp of |
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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