Correlation Between Jahen Household and Chongqing Changan
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By analyzing existing cross correlation between Jahen Household Products and Chongqing Changan Automobile, you can compare the effects of market volatilities on Jahen Household and Chongqing Changan 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 Jahen Household with a short position of Chongqing Changan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jahen Household and Chongqing Changan.
Diversification Opportunities for Jahen Household and Chongqing Changan
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jahen and Chongqing is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Jahen Household Products and Chongqing Changan Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Changan and Jahen Household 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 Jahen Household Products are associated (or correlated) with Chongqing Changan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Changan has no effect on the direction of Jahen Household i.e., Jahen Household and Chongqing Changan go up and down completely randomly.
Pair Corralation between Jahen Household and Chongqing Changan
Assuming the 90 days trading horizon Jahen Household is expected to generate 5.41 times less return on investment than Chongqing Changan. In addition to that, Jahen Household is 1.17 times more volatile than Chongqing Changan Automobile. It trades about 0.0 of its total potential returns per unit of risk. Chongqing Changan Automobile is currently generating about 0.03 per unit of volatility. If you would invest 1,254 in Chongqing Changan Automobile on September 14, 2024 and sell it today you would earn a total of 208.00 from holding Chongqing Changan Automobile or generate 16.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jahen Household Products vs. Chongqing Changan Automobile
Performance |
| Timeline |
| Jahen Household Products |
| Chongqing Changan |
Jahen Household and Chongqing Changan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jahen Household and Chongqing Changan
The main advantage of trading using opposite Jahen Household and Chongqing Changan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jahen Household position performs unexpectedly, Chongqing Changan 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 Chongqing Changan will offset losses from the drop in Chongqing Changan's long position.| Jahen Household vs. China Sports Industry | Jahen Household vs. Hainan Haiqi Transportation | Jahen Household vs. Sino Platinum Metals Co | Jahen Household vs. Aluminum Corp of |
| Chongqing Changan vs. Linzhou Heavy Machinery | Chongqing Changan vs. Shaanxi Broadcast TV | Chongqing Changan vs. Hongrun Construction Group | Chongqing Changan vs. Shanghai Metersbonwe FashionAccessories |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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