Correlation Between China National and Jiujiang Shanshui
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By analyzing existing cross correlation between China National Software and Jiujiang Shanshui Technology, you can compare the effects of market volatilities on China National and Jiujiang Shanshui 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 China National with a short position of Jiujiang Shanshui. Check out your portfolio center. Please also check ongoing floating volatility patterns of China National and Jiujiang Shanshui.
Diversification Opportunities for China National and Jiujiang Shanshui
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Jiujiang is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding China National Software and Jiujiang Shanshui Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiujiang Shanshui and China National 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 China National Software are associated (or correlated) with Jiujiang Shanshui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiujiang Shanshui has no effect on the direction of China National i.e., China National and Jiujiang Shanshui go up and down completely randomly.
Pair Corralation between China National and Jiujiang Shanshui
Assuming the 90 days trading horizon China National Software is expected to generate 1.92 times more return on investment than Jiujiang Shanshui. However, China National is 1.92 times more volatile than Jiujiang Shanshui Technology. It trades about 0.42 of its potential returns per unit of risk. Jiujiang Shanshui Technology is currently generating about 0.33 per unit of risk. If you would invest 4,323 in China National Software on November 28, 2024 and sell it today you would earn a total of 859.00 from holding China National Software or generate 19.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China National Software vs. Jiujiang Shanshui Technology
Performance |
| Timeline |
| China National Software |
| Jiujiang Shanshui |
China National and Jiujiang Shanshui Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China National and Jiujiang Shanshui
The main advantage of trading using opposite China National and Jiujiang Shanshui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China National position performs unexpectedly, Jiujiang Shanshui 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 Jiujiang Shanshui will offset losses from the drop in Jiujiang Shanshui's long position.| China National vs. Advanced Technology Materials | China National vs. Nsfocus Information Technology | China National vs. Beijing Watertek Information | China National vs. Suzhou Xingye Material |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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