Correlation Between Jiangyin Jianghua and Fiberhome Telecommunicatio
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By analyzing existing cross correlation between Jiangyin Jianghua Microelectronics and Fiberhome Telecommunication Technologies, you can compare the effects of market volatilities on Jiangyin Jianghua and Fiberhome Telecommunicatio 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 Jiangyin Jianghua with a short position of Fiberhome Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangyin Jianghua and Fiberhome Telecommunicatio.
Diversification Opportunities for Jiangyin Jianghua and Fiberhome Telecommunicatio
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiangyin and Fiberhome is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Jiangyin Jianghua Microelectro and Fiberhome Telecommunication Te in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiberhome Telecommunicatio and Jiangyin Jianghua 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 Jiangyin Jianghua Microelectronics are associated (or correlated) with Fiberhome Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiberhome Telecommunicatio has no effect on the direction of Jiangyin Jianghua i.e., Jiangyin Jianghua and Fiberhome Telecommunicatio go up and down completely randomly.
Pair Corralation between Jiangyin Jianghua and Fiberhome Telecommunicatio
Assuming the 90 days trading horizon Jiangyin Jianghua Microelectronics is expected to generate 1.93 times more return on investment than Fiberhome Telecommunicatio. However, Jiangyin Jianghua is 1.93 times more volatile than Fiberhome Telecommunication Technologies. It trades about 0.26 of its potential returns per unit of risk. Fiberhome Telecommunication Technologies is currently generating about -0.07 per unit of risk. If you would invest 1,570 in Jiangyin Jianghua Microelectronics on September 1, 2024 and sell it today you would earn a total of 486.00 from holding Jiangyin Jianghua Microelectronics or generate 30.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangyin Jianghua Microelectro vs. Fiberhome Telecommunication Te
Performance |
| Timeline |
| Jiangyin Jianghua |
| Fiberhome Telecommunicatio |
Jiangyin Jianghua and Fiberhome Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangyin Jianghua and Fiberhome Telecommunicatio
The main advantage of trading using opposite Jiangyin Jianghua and Fiberhome Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangyin Jianghua position performs unexpectedly, Fiberhome Telecommunicatio 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 Fiberhome Telecommunicatio will offset losses from the drop in Fiberhome Telecommunicatio's long position.| Jiangyin Jianghua vs. Zhejiang Kingland Pipeline | Jiangyin Jianghua vs. Anhui Deli Household | Jiangyin Jianghua vs. Chahua Modern Housewares | Jiangyin Jianghua vs. Shandong Mining Machinery |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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