Correlation Between China Railway and Jiangsu Yanghe
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By analyzing existing cross correlation between China Railway Construction and Jiangsu Yanghe Brewery, you can compare the effects of market volatilities on China Railway and Jiangsu Yanghe 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 China Railway with a short position of Jiangsu Yanghe. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Railway and Jiangsu Yanghe.
Diversification Opportunities for China Railway and Jiangsu Yanghe
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between China and Jiangsu is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding China Railway Construction and Jiangsu Yanghe Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Yanghe Brewery and China Railway 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 China Railway Construction are associated (or correlated) with Jiangsu Yanghe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Yanghe Brewery has no effect on the direction of China Railway i.e., China Railway and Jiangsu Yanghe go up and down completely randomly.
Pair Corralation between China Railway and Jiangsu Yanghe
Assuming the 90 days trading horizon China Railway Construction is expected to under-perform the Jiangsu Yanghe. In addition to that, China Railway is 1.06 times more volatile than Jiangsu Yanghe Brewery. It trades about -0.3 of its total potential returns per unit of risk. Jiangsu Yanghe Brewery is currently generating about -0.2 per unit of volatility. If you would invest 8,503 in Jiangsu Yanghe Brewery on October 9, 2024 and sell it today you would lose (435.00) from holding Jiangsu Yanghe Brewery or give up 5.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Railway Construction vs. Jiangsu Yanghe Brewery
Performance |
| Timeline |
| China Railway Constr |
| Jiangsu Yanghe Brewery |
China Railway and Jiangsu Yanghe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Railway and Jiangsu Yanghe
The main advantage of trading using opposite China Railway and Jiangsu Yanghe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Railway position performs unexpectedly, Jiangsu Yanghe 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 Jiangsu Yanghe will offset losses from the drop in Jiangsu Yanghe's long position.| China Railway vs. Agricultural Bank of | China Railway vs. Industrial and Commercial | China Railway vs. Bank of China | China Railway vs. PetroChina Co Ltd |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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