Correlation Between Jinling Hotel and Fuda Alloy
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By analyzing existing cross correlation between Jinling Hotel Corp and Fuda Alloy Materials, you can compare the effects of market volatilities on Jinling Hotel and Fuda Alloy 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 Fuda Alloy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinling Hotel and Fuda Alloy.
Diversification Opportunities for Jinling Hotel and Fuda Alloy
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jinling and Fuda is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Jinling Hotel Corp and Fuda Alloy Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuda Alloy Materials 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 Fuda Alloy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuda Alloy Materials has no effect on the direction of Jinling Hotel i.e., Jinling Hotel and Fuda Alloy go up and down completely randomly.
Pair Corralation between Jinling Hotel and Fuda Alloy
Assuming the 90 days trading horizon Jinling Hotel Corp is expected to generate 0.89 times more return on investment than Fuda Alloy. However, Jinling Hotel Corp is 1.12 times less risky than Fuda Alloy. It trades about 0.13 of its potential returns per unit of risk. Fuda Alloy Materials is currently generating about -0.04 per unit of risk. If you would invest 684.00 in Jinling Hotel Corp on September 1, 2024 and sell it today you would earn a total of 43.00 from holding Jinling Hotel Corp or generate 6.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinling Hotel Corp vs. Fuda Alloy Materials
Performance |
| Timeline |
| Jinling Hotel Corp |
| Fuda Alloy Materials |
Jinling Hotel and Fuda Alloy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinling Hotel and Fuda Alloy
The main advantage of trading using opposite Jinling Hotel and Fuda Alloy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinling Hotel position performs unexpectedly, Fuda Alloy 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 Fuda Alloy will offset losses from the drop in Fuda Alloy's long position.| Jinling Hotel vs. Xinjiang Communications Construction | Jinling Hotel vs. Epoxy Base Electronic | Jinling Hotel vs. Sunwave Communications Co | Jinling Hotel vs. Suzhou Mingzhi Technology |
| Fuda Alloy vs. Cultural Investment Holdings | Fuda Alloy vs. Gome Telecom Equipment | Fuda Alloy vs. Bus Online Co | Fuda Alloy vs. Holitech Technology 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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