Correlation Between Jiangsu Financial and Longjian Road
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By analyzing existing cross correlation between Jiangsu Financial Leasing and Longjian Road Bridge, you can compare the effects of market volatilities on Jiangsu Financial and Longjian Road 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 Longjian Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Financial and Longjian Road.
Diversification Opportunities for Jiangsu Financial and Longjian Road
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jiangsu and Longjian is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Financial Leasing and Longjian Road Bridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Longjian Road Bridge 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 Longjian Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Longjian Road Bridge has no effect on the direction of Jiangsu Financial i.e., Jiangsu Financial and Longjian Road go up and down completely randomly.
Pair Corralation between Jiangsu Financial and Longjian Road
Assuming the 90 days trading horizon Jiangsu Financial Leasing is expected to generate 0.52 times more return on investment than Longjian Road. However, Jiangsu Financial Leasing is 1.93 times less risky than Longjian Road. It trades about 0.05 of its potential returns per unit of risk. Longjian Road Bridge is currently generating about -0.33 per unit of risk. If you would invest 513.00 in Jiangsu Financial Leasing on October 18, 2024 and sell it today you would earn a total of 6.00 from holding Jiangsu Financial Leasing or generate 1.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Financial Leasing vs. Longjian Road Bridge
Performance |
| Timeline |
| Jiangsu Financial Leasing |
| Longjian Road Bridge |
Jiangsu Financial and Longjian Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Financial and Longjian Road
The main advantage of trading using opposite Jiangsu Financial and Longjian Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Financial position performs unexpectedly, Longjian Road 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 Longjian Road will offset losses from the drop in Longjian Road's long position.| Jiangsu Financial vs. Leyard Optoelectronic | Jiangsu Financial vs. Sihui Fuji Electronics | Jiangsu Financial vs. Jinlong Machinery Electronic | Jiangsu Financial vs. HaiXin Foods Co |
| Longjian Road vs. Runjian Communication Co | Longjian Road vs. Allied Machinery Co | Longjian Road vs. Fibocom Wireless | Longjian Road vs. Jiangsu Financial Leasing |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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