Correlation Between Jiujiang Shanshui and Long Yuan
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By analyzing existing cross correlation between Jiujiang Shanshui Technology and Long Yuan Construction, you can compare the effects of market volatilities on Jiujiang Shanshui and Long Yuan 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 Long Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiujiang Shanshui and Long Yuan.
Diversification Opportunities for Jiujiang Shanshui and Long Yuan
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiujiang and Long is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Jiujiang Shanshui Technology and Long Yuan Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Long Yuan Construction 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 Long Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Long Yuan Construction has no effect on the direction of Jiujiang Shanshui i.e., Jiujiang Shanshui and Long Yuan go up and down completely randomly.
Pair Corralation between Jiujiang Shanshui and Long Yuan
Assuming the 90 days trading horizon Jiujiang Shanshui Technology is expected to generate 0.6 times more return on investment than Long Yuan. However, Jiujiang Shanshui Technology is 1.67 times less risky than Long Yuan. It trades about 0.02 of its potential returns per unit of risk. Long Yuan Construction is currently generating about 0.01 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 | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiujiang Shanshui Technology vs. Long Yuan Construction
Performance |
| Timeline |
| Jiujiang Shanshui |
| Long Yuan Construction |
Jiujiang Shanshui and Long Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiujiang Shanshui and Long Yuan
The main advantage of trading using opposite Jiujiang Shanshui and Long Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiujiang Shanshui position performs unexpectedly, Long Yuan 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 Long Yuan will offset losses from the drop in Long Yuan'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 |
| Long Yuan vs. Zotye Automobile Co | Long Yuan vs. Guangdong Ellington Electronics | Long Yuan vs. Dongfeng Automobile Co | Long Yuan vs. Epoxy Base Electronic |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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