Correlation Between Shanghai Pudong and Jilin Jlu
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By analyzing existing cross correlation between Shanghai Pudong Development and Jilin Jlu Communication, you can compare the effects of market volatilities on Shanghai Pudong and Jilin Jlu 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 Shanghai Pudong with a short position of Jilin Jlu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Pudong and Jilin Jlu.
Diversification Opportunities for Shanghai Pudong and Jilin Jlu
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Jilin is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Pudong Development and Jilin Jlu Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jilin Jlu Communication and Shanghai Pudong 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 Shanghai Pudong Development are associated (or correlated) with Jilin Jlu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jilin Jlu Communication has no effect on the direction of Shanghai Pudong i.e., Shanghai Pudong and Jilin Jlu go up and down completely randomly.
Pair Corralation between Shanghai Pudong and Jilin Jlu
Assuming the 90 days trading horizon Shanghai Pudong is expected to generate 1.25 times less return on investment than Jilin Jlu. But when comparing it to its historical volatility, Shanghai Pudong Development is 2.65 times less risky than Jilin Jlu. It trades about 0.06 of its potential returns per unit of risk. Jilin Jlu Communication is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 785.00 in Jilin Jlu Communication on August 31, 2024 and sell it today you would earn a total of 168.00 from holding Jilin Jlu Communication or generate 21.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.78% |
| Values | Daily Returns |
Shanghai Pudong Development vs. Jilin Jlu Communication
Performance |
| Timeline |
| Shanghai Pudong Deve |
| Jilin Jlu Communication |
Shanghai Pudong and Jilin Jlu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Pudong and Jilin Jlu
The main advantage of trading using opposite Shanghai Pudong and Jilin Jlu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Pudong position performs unexpectedly, Jilin Jlu 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 Jilin Jlu will offset losses from the drop in Jilin Jlu's long position.| Shanghai Pudong vs. Hangzhou Minsheng Healthcare | Shanghai Pudong vs. Sanbo Hospital Management | Shanghai Pudong vs. Shantou Wanshun Package | Shanghai Pudong vs. Anji Foodstuff Co |
| Jilin Jlu vs. Cultural Investment Holdings | Jilin Jlu vs. Gome Telecom Equipment | Jilin Jlu vs. Bus Online Co | Jilin Jlu vs. Holitech Technology 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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