Correlation Between Industrial and Jiangsu Changfa
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By analyzing existing cross correlation between Industrial and Commercial and Jiangsu Changfa Refrigeration, you can compare the effects of market volatilities on Industrial and Jiangsu Changfa 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 Jiangsu Changfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Jiangsu Changfa.
Diversification Opportunities for Industrial and Jiangsu Changfa
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Industrial and Jiangsu is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Jiangsu Changfa Refrigeration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Changfa Refr 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 Jiangsu Changfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Changfa Refr has no effect on the direction of Industrial i.e., Industrial and Jiangsu Changfa go up and down completely randomly.
Pair Corralation between Industrial and Jiangsu Changfa
Assuming the 90 days trading horizon Industrial and Commercial is expected to generate 0.42 times more return on investment than Jiangsu Changfa. However, Industrial and Commercial is 2.39 times less risky than Jiangsu Changfa. It trades about 0.09 of its potential returns per unit of risk. Jiangsu Changfa Refrigeration is currently generating about 0.02 per unit of risk. If you would invest 400.00 in Industrial and Commercial on September 12, 2024 and sell it today you would earn a total of 242.00 from holding Industrial and Commercial or generate 60.5% 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. Jiangsu Changfa Refrigeration
Performance |
| Timeline |
| Industrial and Commercial |
| Jiangsu Changfa Refr |
Industrial and Jiangsu Changfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Jiangsu Changfa
The main advantage of trading using opposite Industrial and Jiangsu Changfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Jiangsu Changfa 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 Changfa will offset losses from the drop in Jiangsu Changfa's long position.| Industrial vs. Eastroc Beverage Group | Industrial vs. China Publishing Media | Industrial vs. Inly Media Co | Industrial vs. Beijing Sanyuan Foods |
| Jiangsu Changfa vs. Agricultural Bank of | Jiangsu Changfa vs. Industrial and Commercial | Jiangsu Changfa vs. Bank of China | Jiangsu Changfa vs. PetroChina Co Ltd |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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