Correlation Between Beijing Shanghai and Jiangsu Xinri
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By analyzing existing cross correlation between Beijing Shanghai High Speed and Jiangsu Xinri E Vehicle, you can compare the effects of market volatilities on Beijing Shanghai and Jiangsu Xinri 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 Beijing Shanghai with a short position of Jiangsu Xinri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Shanghai and Jiangsu Xinri.
Diversification Opportunities for Beijing Shanghai and Jiangsu Xinri
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beijing and Jiangsu is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Shanghai High Speed and Jiangsu Xinri E Vehicle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Xinri E and Beijing Shanghai 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 Beijing Shanghai High Speed are associated (or correlated) with Jiangsu Xinri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Xinri E has no effect on the direction of Beijing Shanghai i.e., Beijing Shanghai and Jiangsu Xinri go up and down completely randomly.
Pair Corralation between Beijing Shanghai and Jiangsu Xinri
Assuming the 90 days trading horizon Beijing Shanghai High Speed is expected to generate 0.42 times more return on investment than Jiangsu Xinri. However, Beijing Shanghai High Speed is 2.37 times less risky than Jiangsu Xinri. It trades about 0.05 of its potential returns per unit of risk. Jiangsu Xinri E Vehicle is currently generating about -0.02 per unit of risk. If you would invest 530.00 in Beijing Shanghai High Speed on September 12, 2024 and sell it today you would earn a total of 102.00 from holding Beijing Shanghai High Speed or generate 19.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Shanghai High Speed vs. Jiangsu Xinri E Vehicle
Performance |
| Timeline |
| Beijing Shanghai High |
| Jiangsu Xinri E |
Beijing Shanghai and Jiangsu Xinri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Shanghai and Jiangsu Xinri
The main advantage of trading using opposite Beijing Shanghai and Jiangsu Xinri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Shanghai position performs unexpectedly, Jiangsu Xinri 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 Xinri will offset losses from the drop in Jiangsu Xinri's long position.| Beijing Shanghai vs. China Railway Construction | Beijing Shanghai vs. Qijing Machinery | Beijing Shanghai vs. Sichuan Yahua Industrial | Beijing Shanghai vs. Huitong Construction Group |
| Jiangsu Xinri vs. Lutian Machinery Co | Jiangsu Xinri vs. PetroChina Co Ltd | Jiangsu Xinri vs. Bank of China | Jiangsu Xinri vs. Gansu Jiu Steel |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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