Correlation Between Jiangsu Broadcasting and Xinhua Winshare
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By analyzing existing cross correlation between Jiangsu Broadcasting Cable and Xinhua Winshare Publishing, you can compare the effects of market volatilities on Jiangsu Broadcasting and Xinhua Winshare 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 Broadcasting with a short position of Xinhua Winshare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Broadcasting and Xinhua Winshare.
Diversification Opportunities for Jiangsu Broadcasting and Xinhua Winshare
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Jiangsu and Xinhua is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Broadcasting Cable and Xinhua Winshare Publishing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinhua Winshare Publ and Jiangsu Broadcasting 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 Broadcasting Cable are associated (or correlated) with Xinhua Winshare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinhua Winshare Publ has no effect on the direction of Jiangsu Broadcasting i.e., Jiangsu Broadcasting and Xinhua Winshare go up and down completely randomly.
Pair Corralation between Jiangsu Broadcasting and Xinhua Winshare
Assuming the 90 days trading horizon Jiangsu Broadcasting Cable is expected to generate 1.16 times more return on investment than Xinhua Winshare. However, Jiangsu Broadcasting is 1.16 times more volatile than Xinhua Winshare Publishing. It trades about 0.1 of its potential returns per unit of risk. Xinhua Winshare Publishing is currently generating about 0.0 per unit of risk. If you would invest 268.00 in Jiangsu Broadcasting Cable on October 18, 2024 and sell it today you would earn a total of 54.00 from holding Jiangsu Broadcasting Cable or generate 20.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Broadcasting Cable vs. Xinhua Winshare Publishing
Performance |
| Timeline |
| Jiangsu Broadcasting |
| Xinhua Winshare Publ |
Jiangsu Broadcasting and Xinhua Winshare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Broadcasting and Xinhua Winshare
The main advantage of trading using opposite Jiangsu Broadcasting and Xinhua Winshare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Broadcasting position performs unexpectedly, Xinhua Winshare 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 Xinhua Winshare will offset losses from the drop in Xinhua Winshare's long position.The idea behind Jiangsu Broadcasting Cable and Xinhua Winshare Publishing pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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