Correlation Between Jiangsu Financial and Guangdong Shenglu
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By analyzing existing cross correlation between Jiangsu Financial Leasing and Guangdong Shenglu Telecommunication, you can compare the effects of market volatilities on Jiangsu Financial and Guangdong Shenglu 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 Guangdong Shenglu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Financial and Guangdong Shenglu.
Diversification Opportunities for Jiangsu Financial and Guangdong Shenglu
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiangsu and Guangdong is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Financial Leasing and Guangdong Shenglu Telecommunic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Shenglu 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 Guangdong Shenglu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Shenglu has no effect on the direction of Jiangsu Financial i.e., Jiangsu Financial and Guangdong Shenglu go up and down completely randomly.
Pair Corralation between Jiangsu Financial and Guangdong Shenglu
Assuming the 90 days trading horizon Jiangsu Financial is expected to generate 2.74 times less return on investment than Guangdong Shenglu. But when comparing it to its historical volatility, Jiangsu Financial Leasing is 1.35 times less risky than Guangdong Shenglu. It trades about 0.08 of its potential returns per unit of risk. Guangdong Shenglu Telecommunication is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 533.00 in Guangdong Shenglu Telecommunication on August 29, 2024 and sell it today you would earn a total of 179.00 from holding Guangdong Shenglu Telecommunication or generate 33.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Financial Leasing vs. Guangdong Shenglu Telecommunic
Performance |
| Timeline |
| Jiangsu Financial Leasing |
| Guangdong Shenglu |
Jiangsu Financial and Guangdong Shenglu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Financial and Guangdong Shenglu
The main advantage of trading using opposite Jiangsu Financial and Guangdong Shenglu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Financial position performs unexpectedly, Guangdong Shenglu 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 Guangdong Shenglu will offset losses from the drop in Guangdong Shenglu's long position.| Jiangsu Financial vs. Kweichow Moutai Co | Jiangsu Financial vs. Contemporary Amperex Technology | Jiangsu Financial vs. G bits Network Technology | Jiangsu Financial vs. BYD Co Ltd |
| Guangdong Shenglu vs. China State Construction | Guangdong Shenglu vs. Huafa Industrial Co | Guangdong Shenglu vs. China International Capital | Guangdong Shenglu vs. Kweichow Moutai 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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