Correlation Between Jiujiang Shanshui and Shenzhen Changfang
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By analyzing existing cross correlation between Jiujiang Shanshui Technology and Shenzhen Changfang Light, you can compare the effects of market volatilities on Jiujiang Shanshui and Shenzhen Changfang 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 Shenzhen Changfang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiujiang Shanshui and Shenzhen Changfang.
Diversification Opportunities for Jiujiang Shanshui and Shenzhen Changfang
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Jiujiang and Shenzhen is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Jiujiang Shanshui Technology and Shenzhen Changfang Light in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Changfang Light 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 Shenzhen Changfang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Changfang Light has no effect on the direction of Jiujiang Shanshui i.e., Jiujiang Shanshui and Shenzhen Changfang go up and down completely randomly.
Pair Corralation between Jiujiang Shanshui and Shenzhen Changfang
Assuming the 90 days trading horizon Jiujiang Shanshui Technology is expected to under-perform the Shenzhen Changfang. But the stock apears to be less risky and, when comparing its historical volatility, Jiujiang Shanshui Technology is 1.93 times less risky than Shenzhen Changfang. The stock trades about -0.05 of its potential returns per unit of risk. The Shenzhen Changfang Light is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 165.00 in Shenzhen Changfang Light on October 23, 2024 and sell it today you would earn a total of 28.00 from holding Shenzhen Changfang Light or generate 16.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiujiang Shanshui Technology vs. Shenzhen Changfang Light
Performance |
| Timeline |
| Jiujiang Shanshui |
| Shenzhen Changfang Light |
Jiujiang Shanshui and Shenzhen Changfang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiujiang Shanshui and Shenzhen Changfang
The main advantage of trading using opposite Jiujiang Shanshui and Shenzhen Changfang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiujiang Shanshui position performs unexpectedly, Shenzhen Changfang 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 Shenzhen Changfang will offset losses from the drop in Shenzhen Changfang's 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 |
| Shenzhen Changfang vs. Cabio Biotech Wuhan | Shenzhen Changfang vs. De Rucci Healthy | Shenzhen Changfang vs. Anhui Huaren Health | Shenzhen Changfang vs. Jiujiang Shanshui Technology |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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