Correlation Between Jinan Acetate and Halfords Group
Can any of the company-specific risk be diversified away by investing in both Jinan Acetate and Halfords Group 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 Halfords Group 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 Halfords Group PLC, you can compare the effects of market volatilities on Jinan Acetate and Halfords Group 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 Halfords Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinan Acetate and Halfords Group.
Diversification Opportunities for Jinan Acetate and Halfords Group
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Jinan and Halfords is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Jinan Acetate Chemical and Halfords Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Halfords Group PLC 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 Halfords Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Halfords Group PLC has no effect on the direction of Jinan Acetate i.e., Jinan Acetate and Halfords Group go up and down completely randomly.
Pair Corralation between Jinan Acetate and Halfords Group
Assuming the 90 days trading horizon Jinan Acetate Chemical is expected to generate 0.66 times more return on investment than Halfords Group. However, Jinan Acetate Chemical is 1.51 times less risky than Halfords Group. It trades about 0.01 of its potential returns per unit of risk. Halfords Group PLC is currently generating about 0.0 per unit of risk. If you would invest 88,700 in Jinan Acetate Chemical on August 26, 2024 and sell it today you would lose (3,400) from holding Jinan Acetate Chemical or give up 3.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.18% |
| Values | Daily Returns |
Jinan Acetate Chemical vs. Halfords Group PLC
Performance |
| Timeline |
| Jinan Acetate Chemical |
| Halfords Group PLC |
Jinan Acetate and Halfords Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinan Acetate and Halfords Group
The main advantage of trading using opposite Jinan Acetate and Halfords Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinan Acetate position performs unexpectedly, Halfords Group 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 Halfords Group will offset losses from the drop in Halfords Group'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 |
| Halfords Group vs. Burlington Stores | Halfords Group vs. Childrens Place | Halfords Group vs. Buckle Inc | Halfords Group vs. Shoe Carnival |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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