Correlation Between Jiujiang Shanshui and Jiangxi Lianchuang
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By analyzing existing cross correlation between Jiujiang Shanshui Technology and Jiangxi Lianchuang Opto electronic, you can compare the effects of market volatilities on Jiujiang Shanshui and Jiangxi Lianchuang 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 Jiangxi Lianchuang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiujiang Shanshui and Jiangxi Lianchuang.
Diversification Opportunities for Jiujiang Shanshui and Jiangxi Lianchuang
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiujiang and Jiangxi is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Jiujiang Shanshui Technology and Jiangxi Lianchuang Opto electr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi Lianchuang Opto 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 Jiangxi Lianchuang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi Lianchuang Opto has no effect on the direction of Jiujiang Shanshui i.e., Jiujiang Shanshui and Jiangxi Lianchuang go up and down completely randomly.
Pair Corralation between Jiujiang Shanshui and Jiangxi Lianchuang
Assuming the 90 days trading horizon Jiujiang Shanshui is expected to generate 4.26 times less return on investment than Jiangxi Lianchuang. But when comparing it to its historical volatility, Jiujiang Shanshui Technology is 1.3 times less risky than Jiangxi Lianchuang. It trades about 0.03 of its potential returns per unit of risk. Jiangxi Lianchuang Opto electronic is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 2,927 in Jiangxi Lianchuang Opto electronic on August 23, 2024 and sell it today you would earn a total of 1,941 from holding Jiangxi Lianchuang Opto electronic or generate 66.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiujiang Shanshui Technology vs. Jiangxi Lianchuang Opto electr
Performance |
| Timeline |
| Jiujiang Shanshui |
| Jiangxi Lianchuang Opto |
Jiujiang Shanshui and Jiangxi Lianchuang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiujiang Shanshui and Jiangxi Lianchuang
The main advantage of trading using opposite Jiujiang Shanshui and Jiangxi Lianchuang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiujiang Shanshui position performs unexpectedly, Jiangxi Lianchuang 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 Jiangxi Lianchuang will offset losses from the drop in Jiangxi Lianchuang's long position.| Jiujiang Shanshui vs. Zijin Mining Group | Jiujiang Shanshui vs. Wanhua Chemical Group | Jiujiang Shanshui vs. Shandong Gold Mining | Jiujiang Shanshui vs. Inner Mongolia BaoTou |
| Jiangxi Lianchuang vs. Hunan Investment Group | Jiangxi Lianchuang vs. Linewell Software Co | Jiangxi Lianchuang vs. Henan Shuanghui Investment | Jiangxi Lianchuang 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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