Correlation Between Weihai Honglin and Jinling Hotel
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By analyzing existing cross correlation between Weihai Honglin Electronic and Jinling Hotel Corp, you can compare the effects of market volatilities on Weihai Honglin and Jinling Hotel 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 Weihai Honglin with a short position of Jinling Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weihai Honglin and Jinling Hotel.
Diversification Opportunities for Weihai Honglin and Jinling Hotel
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Weihai and Jinling is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Weihai Honglin Electronic and Jinling Hotel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinling Hotel Corp and Weihai Honglin 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 Weihai Honglin Electronic are associated (or correlated) with Jinling Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinling Hotel Corp has no effect on the direction of Weihai Honglin i.e., Weihai Honglin and Jinling Hotel go up and down completely randomly.
Pair Corralation between Weihai Honglin and Jinling Hotel
Assuming the 90 days trading horizon Weihai Honglin Electronic is expected to generate 1.37 times more return on investment than Jinling Hotel. However, Weihai Honglin is 1.37 times more volatile than Jinling Hotel Corp. It trades about 0.14 of its potential returns per unit of risk. Jinling Hotel Corp is currently generating about -0.37 per unit of risk. If you would invest 1,405 in Weihai Honglin Electronic on October 16, 2024 and sell it today you would earn a total of 131.00 from holding Weihai Honglin Electronic or generate 9.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weihai Honglin Electronic vs. Jinling Hotel Corp
Performance |
| Timeline |
| Weihai Honglin Electronic |
| Jinling Hotel Corp |
Weihai Honglin and Jinling Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weihai Honglin and Jinling Hotel
The main advantage of trading using opposite Weihai Honglin and Jinling Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weihai Honglin position performs unexpectedly, Jinling Hotel 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 Jinling Hotel will offset losses from the drop in Jinling Hotel's long position.| Weihai Honglin vs. Eastern Communications Co | Weihai Honglin vs. Strait Innovation Internet | Weihai Honglin vs. Jinhui Liquor Co | Weihai Honglin vs. Fujian Newland Computer |
| Jinling Hotel vs. Weihai Honglin Electronic | Jinling Hotel vs. Jiangxi Naipu Mining | Jinling Hotel vs. Pengxin International Mining | Jinling Hotel vs. Shengda Mining Co |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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