Correlation Between Ligao Foods and Bingshan Refrigeration
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By analyzing existing cross correlation between Ligao Foods CoLtd and Bingshan Refrigeration and, you can compare the effects of market volatilities on Ligao Foods and Bingshan Refrigeration 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 Ligao Foods with a short position of Bingshan Refrigeration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ligao Foods and Bingshan Refrigeration.
Diversification Opportunities for Ligao Foods and Bingshan Refrigeration
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ligao and Bingshan is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Ligao Foods CoLtd and Bingshan Refrigeration and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bingshan Refrigeration and Ligao Foods 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 Ligao Foods CoLtd are associated (or correlated) with Bingshan Refrigeration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bingshan Refrigeration has no effect on the direction of Ligao Foods i.e., Ligao Foods and Bingshan Refrigeration go up and down completely randomly.
Pair Corralation between Ligao Foods and Bingshan Refrigeration
Assuming the 90 days trading horizon Ligao Foods CoLtd is expected to under-perform the Bingshan Refrigeration. In addition to that, Ligao Foods is 1.79 times more volatile than Bingshan Refrigeration and. It trades about -0.02 of its total potential returns per unit of risk. Bingshan Refrigeration and is currently generating about -0.01 per unit of volatility. If you would invest 172.00 in Bingshan Refrigeration and on October 25, 2024 and sell it today you would lose (1.00) from holding Bingshan Refrigeration and or give up 0.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ligao Foods CoLtd vs. Bingshan Refrigeration and
Performance |
| Timeline |
| Ligao Foods CoLtd |
| Bingshan Refrigeration |
Ligao Foods and Bingshan Refrigeration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ligao Foods and Bingshan Refrigeration
The main advantage of trading using opposite Ligao Foods and Bingshan Refrigeration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ligao Foods position performs unexpectedly, Bingshan Refrigeration 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 Bingshan Refrigeration will offset losses from the drop in Bingshan Refrigeration's long position.| Ligao Foods vs. Chongqing Brewery Co | Ligao Foods vs. Guocheng Mining Co | Ligao Foods vs. Jiangsu Yanghe Brewery | Ligao Foods vs. JCHX Mining Management |
| Bingshan Refrigeration vs. Gan Yuan Foods | Bingshan Refrigeration vs. Youyou Foods Co | Bingshan Refrigeration vs. Ligao Foods CoLtd | Bingshan Refrigeration vs. Henan Shuanghui 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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