Correlation Between China State and Jinhe Biotechnology
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By analyzing existing cross correlation between China State Construction and Jinhe Biotechnology Co, you can compare the effects of market volatilities on China State and Jinhe Biotechnology 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 State with a short position of Jinhe Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of China State and Jinhe Biotechnology.
Diversification Opportunities for China State and Jinhe Biotechnology
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Jinhe is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding China State Construction and Jinhe Biotechnology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinhe Biotechnology and China State 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 State Construction are associated (or correlated) with Jinhe Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinhe Biotechnology has no effect on the direction of China State i.e., China State and Jinhe Biotechnology go up and down completely randomly.
Pair Corralation between China State and Jinhe Biotechnology
Assuming the 90 days trading horizon China State Construction is expected to generate 0.73 times more return on investment than Jinhe Biotechnology. However, China State Construction is 1.37 times less risky than Jinhe Biotechnology. It trades about 0.06 of its potential returns per unit of risk. Jinhe Biotechnology Co is currently generating about 0.01 per unit of risk. If you would invest 476.00 in China State Construction on September 3, 2024 and sell it today you would earn a total of 127.00 from holding China State Construction or generate 26.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China State Construction vs. Jinhe Biotechnology Co
Performance |
| Timeline |
| China State Construction |
| Jinhe Biotechnology |
China State and Jinhe Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China State and Jinhe Biotechnology
The main advantage of trading using opposite China State and Jinhe Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China State position performs unexpectedly, Jinhe Biotechnology 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 Jinhe Biotechnology will offset losses from the drop in Jinhe Biotechnology's long position.| China State vs. Citic Guoan Wine | China State vs. Shanghai Yanpu Metal | China State vs. Tongyu Communication | China State vs. Guangxi Wuzhou Communications |
| Jinhe Biotechnology vs. Chengdu Kanghua Biological | Jinhe Biotechnology vs. Beijing Wantai Biological | Jinhe Biotechnology vs. Suzhou Novoprotein Scientific | Jinhe Biotechnology vs. Aluminum Corp of |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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