Correlation Between Jiujiang Shanshui and Xiwang Foodstuffs
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By analyzing existing cross correlation between Jiujiang Shanshui Technology and Xiwang Foodstuffs Co, you can compare the effects of market volatilities on Jiujiang Shanshui and Xiwang Foodstuffs 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 Jiujiang Shanshui with a short position of Xiwang Foodstuffs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiujiang Shanshui and Xiwang Foodstuffs.
Diversification Opportunities for Jiujiang Shanshui and Xiwang Foodstuffs
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiujiang and Xiwang is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Jiujiang Shanshui Technology and Xiwang Foodstuffs Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiwang Foodstuffs and Jiujiang Shanshui 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 Jiujiang Shanshui Technology are associated (or correlated) with Xiwang Foodstuffs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiwang Foodstuffs has no effect on the direction of Jiujiang Shanshui i.e., Jiujiang Shanshui and Xiwang Foodstuffs go up and down completely randomly.
Pair Corralation between Jiujiang Shanshui and Xiwang Foodstuffs
Assuming the 90 days trading horizon Jiujiang Shanshui Technology is expected to generate 0.53 times more return on investment than Xiwang Foodstuffs. However, Jiujiang Shanshui Technology is 1.9 times less risky than Xiwang Foodstuffs. It trades about 0.02 of its potential returns per unit of risk. Xiwang Foodstuffs Co is currently generating about -0.31 per unit of risk. If you would invest 1,533 in Jiujiang Shanshui Technology on November 3, 2024 and sell it today you would earn a total of 7.00 from holding Jiujiang Shanshui Technology or generate 0.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiujiang Shanshui Technology vs. Xiwang Foodstuffs Co
Performance |
| Timeline |
| Jiujiang Shanshui |
| Xiwang Foodstuffs |
Jiujiang Shanshui and Xiwang Foodstuffs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiujiang Shanshui and Xiwang Foodstuffs
The main advantage of trading using opposite Jiujiang Shanshui and Xiwang Foodstuffs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiujiang Shanshui position performs unexpectedly, Xiwang Foodstuffs 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 Xiwang Foodstuffs will offset losses from the drop in Xiwang Foodstuffs' long position.| Jiujiang Shanshui vs. Zijin Mining Group | Jiujiang Shanshui vs. Wanhua Chemical Group | Jiujiang Shanshui vs. Baoshan Iron Steel | Jiujiang Shanshui 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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