Correlation Between Jinsanjiang Silicon and Harbin Hatou
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By analyzing existing cross correlation between Jinsanjiang Silicon Material and Harbin Hatou Investment, you can compare the effects of market volatilities on Jinsanjiang Silicon and Harbin Hatou 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 Jinsanjiang Silicon with a short position of Harbin Hatou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinsanjiang Silicon and Harbin Hatou.
Diversification Opportunities for Jinsanjiang Silicon and Harbin Hatou
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jinsanjiang and Harbin is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Jinsanjiang Silicon Material and Harbin Hatou Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbin Hatou Investment and Jinsanjiang Silicon 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 Jinsanjiang Silicon Material are associated (or correlated) with Harbin Hatou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbin Hatou Investment has no effect on the direction of Jinsanjiang Silicon i.e., Jinsanjiang Silicon and Harbin Hatou go up and down completely randomly.
Pair Corralation between Jinsanjiang Silicon and Harbin Hatou
Assuming the 90 days trading horizon Jinsanjiang Silicon Material is expected to generate 1.19 times more return on investment than Harbin Hatou. However, Jinsanjiang Silicon is 1.19 times more volatile than Harbin Hatou Investment. It trades about 0.01 of its potential returns per unit of risk. Harbin Hatou Investment is currently generating about -0.03 per unit of risk. If you would invest 1,131 in Jinsanjiang Silicon Material on October 22, 2024 and sell it today you would lose (20.00) from holding Jinsanjiang Silicon Material or give up 1.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.67% |
| Values | Daily Returns |
Jinsanjiang Silicon Material vs. Harbin Hatou Investment
Performance |
| Timeline |
| Jinsanjiang Silicon |
| Harbin Hatou Investment |
Jinsanjiang Silicon and Harbin Hatou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinsanjiang Silicon and Harbin Hatou
The main advantage of trading using opposite Jinsanjiang Silicon and Harbin Hatou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinsanjiang Silicon position performs unexpectedly, Harbin Hatou 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 Harbin Hatou will offset losses from the drop in Harbin Hatou's long position.The idea behind Jinsanjiang Silicon Material and Harbin Hatou Investment pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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