Correlation Between Changjiang Jinggong and Shijiazhuang Tonhe
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By analyzing existing cross correlation between Changjiang Jinggong Steel and Shijiazhuang Tonhe Electronics, you can compare the effects of market volatilities on Changjiang Jinggong and Shijiazhuang Tonhe 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 Changjiang Jinggong with a short position of Shijiazhuang Tonhe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changjiang Jinggong and Shijiazhuang Tonhe.
Diversification Opportunities for Changjiang Jinggong and Shijiazhuang Tonhe
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Changjiang and Shijiazhuang is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Changjiang Jinggong Steel and Shijiazhuang Tonhe Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shijiazhuang Tonhe and Changjiang Jinggong 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 Changjiang Jinggong Steel are associated (or correlated) with Shijiazhuang Tonhe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shijiazhuang Tonhe has no effect on the direction of Changjiang Jinggong i.e., Changjiang Jinggong and Shijiazhuang Tonhe go up and down completely randomly.
Pair Corralation between Changjiang Jinggong and Shijiazhuang Tonhe
Assuming the 90 days trading horizon Changjiang Jinggong Steel is expected to generate 0.27 times more return on investment than Shijiazhuang Tonhe. However, Changjiang Jinggong Steel is 3.7 times less risky than Shijiazhuang Tonhe. It trades about -0.51 of its potential returns per unit of risk. Shijiazhuang Tonhe Electronics is currently generating about -0.14 per unit of risk. If you would invest 328.00 in Changjiang Jinggong Steel on October 16, 2024 and sell it today you would lose (47.00) from holding Changjiang Jinggong Steel or give up 14.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changjiang Jinggong Steel vs. Shijiazhuang Tonhe Electronics
Performance |
| Timeline |
| Changjiang Jinggong Steel |
| Shijiazhuang Tonhe |
Changjiang Jinggong and Shijiazhuang Tonhe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changjiang Jinggong and Shijiazhuang Tonhe
The main advantage of trading using opposite Changjiang Jinggong and Shijiazhuang Tonhe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changjiang Jinggong position performs unexpectedly, Shijiazhuang Tonhe 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 Shijiazhuang Tonhe will offset losses from the drop in Shijiazhuang Tonhe's long position.| Changjiang Jinggong vs. Ningbo Homelink Eco iTech | Changjiang Jinggong vs. Zoy Home Furnishing | Changjiang Jinggong vs. Jahen Household Products | Changjiang Jinggong vs. Arrow Home Group |
| Shijiazhuang Tonhe vs. Beijing Jiaman Dress | Shijiazhuang Tonhe vs. Anhui Transport Consulting | Shijiazhuang Tonhe vs. Changjiang Jinggong Steel | Shijiazhuang Tonhe vs. Road Environment Technology |
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 Stocks Directory module to find actively traded stocks across global markets.
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