Correlation Between Mengtian Home and Jahen Household
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By analyzing existing cross correlation between Mengtian Home Group and Jahen Household Products, you can compare the effects of market volatilities on Mengtian Home and Jahen Household 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 Mengtian Home with a short position of Jahen Household. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mengtian Home and Jahen Household.
Diversification Opportunities for Mengtian Home and Jahen Household
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mengtian and Jahen is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Mengtian Home Group and Jahen Household Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jahen Household Products and Mengtian Home 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 Mengtian Home Group are associated (or correlated) with Jahen Household. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jahen Household Products has no effect on the direction of Mengtian Home i.e., Mengtian Home and Jahen Household go up and down completely randomly.
Pair Corralation between Mengtian Home and Jahen Household
Assuming the 90 days trading horizon Mengtian Home Group is expected to generate 0.6 times more return on investment than Jahen Household. However, Mengtian Home Group is 1.66 times less risky than Jahen Household. It trades about 0.09 of its potential returns per unit of risk. Jahen Household Products is currently generating about -0.01 per unit of risk. If you would invest 1,050 in Mengtian Home Group on August 29, 2024 and sell it today you would earn a total of 34.00 from holding Mengtian Home Group or generate 3.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mengtian Home Group vs. Jahen Household Products
Performance |
| Timeline |
| Mengtian Home Group |
| Jahen Household Products |
Mengtian Home and Jahen Household Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mengtian Home and Jahen Household
The main advantage of trading using opposite Mengtian Home and Jahen Household positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mengtian Home position performs unexpectedly, Jahen Household 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 Jahen Household will offset losses from the drop in Jahen Household's long position.| Mengtian Home vs. Agricultural Bank of | Mengtian Home vs. Industrial and Commercial | Mengtian Home vs. Bank of China | Mengtian Home vs. China Construction Bank |
| Jahen Household vs. Baoshan Iron Steel | Jahen Household vs. Shandong Gold Mining | Jahen Household vs. Rongsheng Petrochemical Co | Jahen Household vs. Inner Mongolia BaoTou |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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