Correlation Between Jiangsu Financial and Guizhou Chanhen
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By analyzing existing cross correlation between Jiangsu Financial Leasing and Guizhou Chanhen Chemical, you can compare the effects of market volatilities on Jiangsu Financial and Guizhou Chanhen 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 Guizhou Chanhen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Financial and Guizhou Chanhen.
Diversification Opportunities for Jiangsu Financial and Guizhou Chanhen
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Jiangsu and Guizhou is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Financial Leasing and Guizhou Chanhen Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guizhou Chanhen Chemical 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 Guizhou Chanhen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guizhou Chanhen Chemical has no effect on the direction of Jiangsu Financial i.e., Jiangsu Financial and Guizhou Chanhen go up and down completely randomly.
Pair Corralation between Jiangsu Financial and Guizhou Chanhen
Assuming the 90 days trading horizon Jiangsu Financial Leasing is expected to generate 0.67 times more return on investment than Guizhou Chanhen. However, Jiangsu Financial Leasing is 1.5 times less risky than Guizhou Chanhen. It trades about 0.04 of its potential returns per unit of risk. Guizhou Chanhen Chemical is currently generating about -0.01 per unit of risk. If you would invest 398.00 in Jiangsu Financial Leasing on October 26, 2024 and sell it today you would earn a total of 129.00 from holding Jiangsu Financial Leasing or generate 32.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Financial Leasing vs. Guizhou Chanhen Chemical
Performance |
| Timeline |
| Jiangsu Financial Leasing |
| Guizhou Chanhen Chemical |
Jiangsu Financial and Guizhou Chanhen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Financial and Guizhou Chanhen
The main advantage of trading using opposite Jiangsu Financial and Guizhou Chanhen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Financial position performs unexpectedly, Guizhou Chanhen 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 Guizhou Chanhen will offset losses from the drop in Guizhou Chanhen's long position.| Jiangsu Financial vs. Xinjiang Baodi Mining | Jiangsu Financial vs. Tonghua Grape Wine | Jiangsu Financial vs. Beingmate Baby Child | Jiangsu Financial vs. ZYF Lopsking Aluminum |
| Guizhou Chanhen vs. Central Plains Environment | Guizhou Chanhen vs. GreenTech Environmental Co | Guizhou Chanhen vs. Fujian Nanwang Environment | Guizhou Chanhen vs. Eit Environmental Development |
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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