Correlation Between HeBei Jinniu and Dongxing Sec
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By analyzing existing cross correlation between HeBei Jinniu Chemical and Dongxing Sec Co, you can compare the effects of market volatilities on HeBei Jinniu and Dongxing Sec 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 HeBei Jinniu with a short position of Dongxing Sec. Check out your portfolio center. Please also check ongoing floating volatility patterns of HeBei Jinniu and Dongxing Sec.
Diversification Opportunities for HeBei Jinniu and Dongxing Sec
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between HeBei and Dongxing is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding HeBei Jinniu Chemical and Dongxing Sec Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongxing Sec and HeBei Jinniu 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 HeBei Jinniu Chemical are associated (or correlated) with Dongxing Sec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongxing Sec has no effect on the direction of HeBei Jinniu i.e., HeBei Jinniu and Dongxing Sec go up and down completely randomly.
Pair Corralation between HeBei Jinniu and Dongxing Sec
Assuming the 90 days trading horizon HeBei Jinniu is expected to generate 1.75 times less return on investment than Dongxing Sec. In addition to that, HeBei Jinniu is 1.16 times more volatile than Dongxing Sec Co. It trades about 0.02 of its total potential returns per unit of risk. Dongxing Sec Co is currently generating about 0.03 per unit of volatility. If you would invest 849.00 in Dongxing Sec Co on October 11, 2024 and sell it today you would earn a total of 239.00 from holding Dongxing Sec Co or generate 28.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HeBei Jinniu Chemical vs. Dongxing Sec Co
Performance |
| Timeline |
| HeBei Jinniu Chemical |
| Dongxing Sec |
HeBei Jinniu and Dongxing Sec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HeBei Jinniu and Dongxing Sec
The main advantage of trading using opposite HeBei Jinniu and Dongxing Sec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HeBei Jinniu position performs unexpectedly, Dongxing Sec 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 Dongxing Sec will offset losses from the drop in Dongxing Sec's long position.| HeBei Jinniu vs. Eastroc Beverage Group | HeBei Jinniu vs. Gansu Jiu Steel | HeBei Jinniu vs. Central Plains Environment | HeBei Jinniu vs. Eit Environmental Development |
| Dongxing Sec vs. Liaoning Dingjide Petrochemical | Dongxing Sec vs. HeBei Jinniu Chemical | Dongxing Sec vs. Jinsanjiang Silicon Material | Dongxing Sec vs. Jinling Hotel Corp |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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