Correlation Between Jinan Acetate and Double Bond
Can any of the company-specific risk be diversified away by investing in both Jinan Acetate and Double Bond 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 Double Bond 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 Double Bond Chemical, you can compare the effects of market volatilities on Jinan Acetate and Double Bond 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 Double Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinan Acetate and Double Bond.
Diversification Opportunities for Jinan Acetate and Double Bond
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jinan and Double is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Jinan Acetate Chemical and Double Bond Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Double Bond Chemical 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 Double Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Double Bond Chemical has no effect on the direction of Jinan Acetate i.e., Jinan Acetate and Double Bond go up and down completely randomly.
Pair Corralation between Jinan Acetate and Double Bond
Assuming the 90 days trading horizon Jinan Acetate Chemical is expected to under-perform the Double Bond. In addition to that, Jinan Acetate is 1.01 times more volatile than Double Bond Chemical. It trades about -0.08 of its total potential returns per unit of risk. Double Bond Chemical is currently generating about -0.02 per unit of volatility. If you would invest 4,465 in Double Bond Chemical on August 26, 2024 and sell it today you would lose (80.00) from holding Double Bond Chemical or give up 1.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinan Acetate Chemical vs. Double Bond Chemical
Performance |
| Timeline |
| Jinan Acetate Chemical |
| Double Bond Chemical |
Jinan Acetate and Double Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinan Acetate and Double Bond
The main advantage of trading using opposite Jinan Acetate and Double Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinan Acetate position performs unexpectedly, Double Bond 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 Double Bond will offset losses from the drop in Double Bond's long position.| Jinan Acetate vs. San Fu Chemical | Jinan Acetate vs. Tex Year Industries | Jinan Acetate vs. Concraft Holding Co | Jinan Acetate vs. Coremax Corp |
| Double Bond vs. Delta Electronics | Double Bond vs. China Steel Chemical | Double Bond vs. Hota Industrial Mfg | Double Bond vs. Ruentex Development 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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