Correlation Between Jiangsu Financial and HeNan Splendor
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By analyzing existing cross correlation between Jiangsu Financial Leasing and HeNan Splendor Science, you can compare the effects of market volatilities on Jiangsu Financial and HeNan Splendor 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 Jiangsu Financial with a short position of HeNan Splendor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Financial and HeNan Splendor.
Diversification Opportunities for Jiangsu Financial and HeNan Splendor
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiangsu and HeNan is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Financial Leasing and HeNan Splendor Science in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HeNan Splendor Science and Jiangsu Financial 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 Jiangsu Financial Leasing are associated (or correlated) with HeNan Splendor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HeNan Splendor Science has no effect on the direction of Jiangsu Financial i.e., Jiangsu Financial and HeNan Splendor go up and down completely randomly.
Pair Corralation between Jiangsu Financial and HeNan Splendor
Assuming the 90 days trading horizon Jiangsu Financial is expected to generate 1.04 times less return on investment than HeNan Splendor. But when comparing it to its historical volatility, Jiangsu Financial Leasing is 1.74 times less risky than HeNan Splendor. It trades about 0.05 of its potential returns per unit of risk. HeNan Splendor Science is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 903.00 in HeNan Splendor Science on September 4, 2024 and sell it today you would earn a total of 159.00 from holding HeNan Splendor Science or generate 17.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Financial Leasing vs. HeNan Splendor Science
Performance |
| Timeline |
| Jiangsu Financial Leasing |
| HeNan Splendor Science |
Jiangsu Financial and HeNan Splendor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Financial and HeNan Splendor
The main advantage of trading using opposite Jiangsu Financial and HeNan Splendor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Financial position performs unexpectedly, HeNan Splendor 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 HeNan Splendor will offset losses from the drop in HeNan Splendor's long position.| Jiangsu Financial vs. China Petroleum Chemical | Jiangsu Financial vs. PetroChina Co Ltd | Jiangsu Financial vs. China State Construction | Jiangsu Financial vs. China Railway Group |
| HeNan Splendor vs. Industrial and Commercial | HeNan Splendor vs. China Construction Bank | HeNan Splendor vs. Bank of China | HeNan Splendor vs. Agricultural Bank of |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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