Correlation Between Sichuan Hebang and Jiangsu Jinling
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By analyzing existing cross correlation between Sichuan Hebang Biotechnology and Jiangsu Jinling Sports, you can compare the effects of market volatilities on Sichuan Hebang and Jiangsu Jinling 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 Sichuan Hebang with a short position of Jiangsu Jinling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Hebang and Jiangsu Jinling.
Diversification Opportunities for Sichuan Hebang and Jiangsu Jinling
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sichuan and Jiangsu is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Hebang Biotechnology and Jiangsu Jinling Sports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Jinling Sports and Sichuan Hebang 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 Sichuan Hebang Biotechnology are associated (or correlated) with Jiangsu Jinling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Jinling Sports has no effect on the direction of Sichuan Hebang i.e., Sichuan Hebang and Jiangsu Jinling go up and down completely randomly.
Pair Corralation between Sichuan Hebang and Jiangsu Jinling
Assuming the 90 days trading horizon Sichuan Hebang Biotechnology is expected to under-perform the Jiangsu Jinling. But the stock apears to be less risky and, when comparing its historical volatility, Sichuan Hebang Biotechnology is 1.79 times less risky than Jiangsu Jinling. The stock trades about -0.05 of its potential returns per unit of risk. The Jiangsu Jinling Sports is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 2,258 in Jiangsu Jinling Sports on October 13, 2024 and sell it today you would lose (1,093) from holding Jiangsu Jinling Sports or give up 48.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Hebang Biotechnology vs. Jiangsu Jinling Sports
Performance |
| Timeline |
| Sichuan Hebang Biote |
| Jiangsu Jinling Sports |
Sichuan Hebang and Jiangsu Jinling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Hebang and Jiangsu Jinling
The main advantage of trading using opposite Sichuan Hebang and Jiangsu Jinling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Hebang position performs unexpectedly, Jiangsu Jinling 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 Jinling will offset losses from the drop in Jiangsu Jinling's long position.| Sichuan Hebang vs. Namchow Food Group | Sichuan Hebang vs. Fiberhome Telecommunication Technologies | Sichuan Hebang vs. V V Food | Sichuan Hebang vs. Xinjiang Tianrun Dairy |
| Jiangsu Jinling vs. Glodon Software Co | Jiangsu Jinling vs. Jiangsu Hoperun Software | Jiangsu Jinling vs. GuoChuang Software Co | Jiangsu Jinling vs. Ye Chiu Metal |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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