Correlation Between Industrial and Jiangxi Sunshine
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By analyzing existing cross correlation between Industrial and Commercial and Jiangxi Sunshine Dairy, you can compare the effects of market volatilities on Industrial and Jiangxi Sunshine 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 Industrial with a short position of Jiangxi Sunshine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Jiangxi Sunshine.
Diversification Opportunities for Industrial and Jiangxi Sunshine
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Industrial and Jiangxi is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Jiangxi Sunshine Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi Sunshine Dairy and Industrial 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 Industrial and Commercial are associated (or correlated) with Jiangxi Sunshine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi Sunshine Dairy has no effect on the direction of Industrial i.e., Industrial and Jiangxi Sunshine go up and down completely randomly.
Pair Corralation between Industrial and Jiangxi Sunshine
Assuming the 90 days trading horizon Industrial and Commercial is expected to generate 0.51 times more return on investment than Jiangxi Sunshine. However, Industrial and Commercial is 1.97 times less risky than Jiangxi Sunshine. It trades about 0.09 of its potential returns per unit of risk. Jiangxi Sunshine Dairy is currently generating about 0.0 per unit of risk. If you would invest 399.00 in Industrial and Commercial on September 14, 2024 and sell it today you would earn a total of 243.00 from holding Industrial and Commercial or generate 60.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. Jiangxi Sunshine Dairy
Performance |
| Timeline |
| Industrial and Commercial |
| Jiangxi Sunshine Dairy |
Industrial and Jiangxi Sunshine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Jiangxi Sunshine
The main advantage of trading using opposite Industrial and Jiangxi Sunshine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Jiangxi Sunshine 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 Jiangxi Sunshine will offset losses from the drop in Jiangxi Sunshine's long position.| Industrial vs. Allmed Medical Products | Industrial vs. Blue Sail Medical | Industrial vs. Yingde Greatchem Chemicals | Industrial vs. Zhongzhu Medical Holdings |
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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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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