Correlation Between Jinling Hotel and Weihai Honglin
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By analyzing existing cross correlation between Jinling Hotel Corp and Weihai Honglin Electronic, you can compare the effects of market volatilities on Jinling Hotel and Weihai Honglin 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 Jinling Hotel with a short position of Weihai Honglin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinling Hotel and Weihai Honglin.
Diversification Opportunities for Jinling Hotel and Weihai Honglin
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Jinling and Weihai is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Jinling Hotel Corp and Weihai Honglin Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weihai Honglin Electronic and Jinling Hotel 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 Jinling Hotel Corp are associated (or correlated) with Weihai Honglin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weihai Honglin Electronic has no effect on the direction of Jinling Hotel i.e., Jinling Hotel and Weihai Honglin go up and down completely randomly.
Pair Corralation between Jinling Hotel and Weihai Honglin
Assuming the 90 days trading horizon Jinling Hotel Corp is expected to under-perform the Weihai Honglin. But the stock apears to be less risky and, when comparing its historical volatility, Jinling Hotel Corp is 1.19 times less risky than Weihai Honglin. The stock trades about -0.03 of its potential returns per unit of risk. The Weihai Honglin Electronic is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 2,342 in Weihai Honglin Electronic on October 16, 2024 and sell it today you would lose (809.00) from holding Weihai Honglin Electronic or give up 34.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 92.9% |
| Values | Daily Returns |
Jinling Hotel Corp vs. Weihai Honglin Electronic
Performance |
| Timeline |
| Jinling Hotel Corp |
| Weihai Honglin Electronic |
Jinling Hotel and Weihai Honglin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinling Hotel and Weihai Honglin
The main advantage of trading using opposite Jinling Hotel and Weihai Honglin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinling Hotel position performs unexpectedly, Weihai Honglin 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 Weihai Honglin will offset losses from the drop in Weihai Honglin's long position.| Jinling Hotel vs. Weihai Honglin Electronic | Jinling Hotel vs. Jiangxi Naipu Mining | Jinling Hotel vs. Pengxin International Mining | Jinling Hotel vs. Shengda Mining Co |
| Weihai Honglin vs. Eastern Communications Co | Weihai Honglin vs. Strait Innovation Internet | Weihai Honglin vs. Jinhui Liquor Co | Weihai Honglin vs. Fujian Newland Computer |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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