Correlation Between Jinan Acetate and Kinik
Can any of the company-specific risk be diversified away by investing in both Jinan Acetate and Kinik at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Jinan Acetate and Kinik into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jinan Acetate Chemical and Kinik Co, you can compare the effects of market volatilities on Jinan Acetate and Kinik 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 Jinan Acetate with a short position of Kinik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinan Acetate and Kinik.
Diversification Opportunities for Jinan Acetate and Kinik
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Jinan and Kinik is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Jinan Acetate Chemical and Kinik Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinik and Jinan Acetate 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 Jinan Acetate Chemical are associated (or correlated) with Kinik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinik has no effect on the direction of Jinan Acetate i.e., Jinan Acetate and Kinik go up and down completely randomly.
Pair Corralation between Jinan Acetate and Kinik
Assuming the 90 days trading horizon Jinan Acetate Chemical is expected to generate 0.57 times more return on investment than Kinik. However, Jinan Acetate Chemical is 1.74 times less risky than Kinik. It trades about 0.16 of its potential returns per unit of risk. Kinik Co is currently generating about -0.11 per unit of risk. If you would invest 84,400 in Jinan Acetate Chemical on August 28, 2024 and sell it today you would earn a total of 4,100 from holding Jinan Acetate Chemical or generate 4.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinan Acetate Chemical vs. Kinik Co
Performance |
| Timeline |
| Jinan Acetate Chemical |
| Kinik |
Jinan Acetate and Kinik Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinan Acetate and Kinik
The main advantage of trading using opposite Jinan Acetate and Kinik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinan Acetate position performs unexpectedly, Kinik 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 Kinik will offset losses from the drop in Kinik's long position.| Jinan Acetate vs. Cheng Shin Rubber | Jinan Acetate vs. China Steel Chemical | Jinan Acetate vs. Yulon Motor Co |
| Kinik vs. Sunny Friend Environmental | Kinik vs. TTET Union Corp | Kinik vs. ECOVE Environment Corp | Kinik vs. Yulon Finance Corp |
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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