Correlation Between HeBei Jinniu and Eastroc Beverage
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By analyzing existing cross correlation between HeBei Jinniu Chemical and Eastroc Beverage Group, you can compare the effects of market volatilities on HeBei Jinniu and Eastroc Beverage 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 Eastroc Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of HeBei Jinniu and Eastroc Beverage.
Diversification Opportunities for HeBei Jinniu and Eastroc Beverage
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between HeBei and Eastroc is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding HeBei Jinniu Chemical and Eastroc Beverage Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastroc Beverage 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 Eastroc Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastroc Beverage has no effect on the direction of HeBei Jinniu i.e., HeBei Jinniu and Eastroc Beverage go up and down completely randomly.
Pair Corralation between HeBei Jinniu and Eastroc Beverage
Assuming the 90 days trading horizon HeBei Jinniu Chemical is expected to generate 1.36 times more return on investment than Eastroc Beverage. However, HeBei Jinniu is 1.36 times more volatile than Eastroc Beverage Group. It trades about 0.15 of its potential returns per unit of risk. Eastroc Beverage Group is currently generating about 0.13 per unit of risk. If you would invest 413.00 in HeBei Jinniu Chemical on August 28, 2024 and sell it today you would earn a total of 78.00 from holding HeBei Jinniu Chemical or generate 18.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
HeBei Jinniu Chemical vs. Eastroc Beverage Group
Performance |
| Timeline |
| HeBei Jinniu Chemical |
| Eastroc Beverage |
HeBei Jinniu and Eastroc Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HeBei Jinniu and Eastroc Beverage
The main advantage of trading using opposite HeBei Jinniu and Eastroc Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HeBei Jinniu position performs unexpectedly, Eastroc Beverage 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 Eastroc Beverage will offset losses from the drop in Eastroc Beverage's long position.| HeBei Jinniu vs. Zijin Mining Group | HeBei Jinniu vs. Wanhua Chemical Group | HeBei Jinniu vs. Baoshan Iron Steel | HeBei Jinniu vs. Shandong Gold Mining |
| Eastroc Beverage vs. China Petroleum Chemical | Eastroc Beverage vs. PetroChina Co Ltd | Eastroc Beverage vs. China State Construction | Eastroc Beverage vs. China Railway Group |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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