Correlation Between Tianjin Capital and Jiangxi JDL
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By analyzing existing cross correlation between Tianjin Capital Environmental and Jiangxi JDL Environmental, you can compare the effects of market volatilities on Tianjin Capital and Jiangxi JDL 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 Tianjin Capital with a short position of Jiangxi JDL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Capital and Jiangxi JDL.
Diversification Opportunities for Tianjin Capital and Jiangxi JDL
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Tianjin and Jiangxi is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Capital Environmental and Jiangxi JDL Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi JDL Environmental and Tianjin Capital 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 Tianjin Capital Environmental are associated (or correlated) with Jiangxi JDL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi JDL Environmental has no effect on the direction of Tianjin Capital i.e., Tianjin Capital and Jiangxi JDL go up and down completely randomly.
Pair Corralation between Tianjin Capital and Jiangxi JDL
Assuming the 90 days trading horizon Tianjin Capital is expected to generate 1.07 times less return on investment than Jiangxi JDL. But when comparing it to its historical volatility, Tianjin Capital Environmental is 1.22 times less risky than Jiangxi JDL. It trades about 0.21 of its potential returns per unit of risk. Jiangxi JDL Environmental is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 940.00 in Jiangxi JDL Environmental on September 12, 2024 and sell it today you would earn a total of 293.00 from holding Jiangxi JDL Environmental or generate 31.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianjin Capital Environmental vs. Jiangxi JDL Environmental
Performance |
| Timeline |
| Tianjin Capital Envi |
| Jiangxi JDL Environmental |
Tianjin Capital and Jiangxi JDL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Capital and Jiangxi JDL
The main advantage of trading using opposite Tianjin Capital and Jiangxi JDL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Capital position performs unexpectedly, Jiangxi JDL 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 Jiangxi JDL will offset losses from the drop in Jiangxi JDL's long position.| Tianjin Capital vs. Lutian Machinery Co | Tianjin Capital vs. China Longyuan Power | Tianjin Capital vs. PetroChina Co Ltd | Tianjin Capital vs. Bank of China |
| Jiangxi JDL vs. Qijing Machinery | Jiangxi JDL vs. Kingclean Electric Co | Jiangxi JDL vs. Gan Yuan Foods | Jiangxi JDL vs. Youyou Foods Co |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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