Correlation Between Wuhan Yangtze and Jiajia Food
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By analyzing existing cross correlation between Wuhan Yangtze Communication and Jiajia Food Group, you can compare the effects of market volatilities on Wuhan Yangtze and Jiajia Food 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 Wuhan Yangtze with a short position of Jiajia Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuhan Yangtze and Jiajia Food.
Diversification Opportunities for Wuhan Yangtze and Jiajia Food
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wuhan and Jiajia is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Wuhan Yangtze Communication and Jiajia Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiajia Food Group and Wuhan Yangtze 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 Wuhan Yangtze Communication are associated (or correlated) with Jiajia Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiajia Food Group has no effect on the direction of Wuhan Yangtze i.e., Wuhan Yangtze and Jiajia Food go up and down completely randomly.
Pair Corralation between Wuhan Yangtze and Jiajia Food
Assuming the 90 days trading horizon Wuhan Yangtze is expected to generate 2.77 times less return on investment than Jiajia Food. In addition to that, Wuhan Yangtze is 1.17 times more volatile than Jiajia Food Group. It trades about 0.08 of its total potential returns per unit of risk. Jiajia Food Group is currently generating about 0.25 per unit of volatility. If you would invest 183.00 in Jiajia Food Group on November 7, 2024 and sell it today you would earn a total of 290.00 from holding Jiajia Food Group or generate 158.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wuhan Yangtze Communication vs. Jiajia Food Group
Performance |
| Timeline |
| Wuhan Yangtze Commun |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
| Jiajia Food Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
Wuhan Yangtze and Jiajia Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wuhan Yangtze and Jiajia Food
The main advantage of trading using opposite Wuhan Yangtze and Jiajia Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuhan Yangtze position performs unexpectedly, Jiajia Food 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 Jiajia Food will offset losses from the drop in Jiajia Food's long position.The idea behind Wuhan Yangtze Communication and Jiajia Food Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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