Correlation Between China Railway and Jizhong Energy
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By analyzing existing cross correlation between China Railway Group and Jizhong Energy Resources, you can compare the effects of market volatilities on China Railway and Jizhong Energy 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 Jizhong Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Railway and Jizhong Energy.
Diversification Opportunities for China Railway and Jizhong Energy
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Jizhong is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding China Railway Group and Jizhong Energy Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jizhong Energy Resources 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 Group are associated (or correlated) with Jizhong Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jizhong Energy Resources has no effect on the direction of China Railway i.e., China Railway and Jizhong Energy go up and down completely randomly.
Pair Corralation between China Railway and Jizhong Energy
Assuming the 90 days trading horizon China Railway Group is expected to generate 1.36 times more return on investment than Jizhong Energy. However, China Railway is 1.36 times more volatile than Jizhong Energy Resources. It trades about -0.01 of its potential returns per unit of risk. Jizhong Energy Resources is currently generating about -0.05 per unit of risk. If you would invest 657.00 in China Railway Group on August 29, 2024 and sell it today you would lose (19.00) from holding China Railway Group or give up 2.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Railway Group vs. Jizhong Energy Resources
Performance |
| Timeline |
| China Railway Group |
| Jizhong Energy Resources |
China Railway and Jizhong Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Railway and Jizhong Energy
The main advantage of trading using opposite China Railway and Jizhong Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Railway position performs unexpectedly, Jizhong Energy 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 Jizhong Energy will offset losses from the drop in Jizhong Energy's long position.| China Railway vs. Hangzhou Gisway Information | China Railway vs. ButOne Information Corp | China Railway vs. Chinese Universe Publishing | China Railway vs. Zhejiang Publishing Media |
| Jizhong Energy vs. Easyhome New Retail | Jizhong Energy vs. Beijing Bashi Media | Jizhong Energy vs. CSSC Offshore Marine | Jizhong Energy vs. Inly Media 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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