Correlation Between Liaoning Dingjide and Jiangxi Selon
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By analyzing existing cross correlation between Liaoning Dingjide Petrochemical and Jiangxi Selon Industrial, you can compare the effects of market volatilities on Liaoning Dingjide and Jiangxi Selon 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 Liaoning Dingjide with a short position of Jiangxi Selon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liaoning Dingjide and Jiangxi Selon.
Diversification Opportunities for Liaoning Dingjide and Jiangxi Selon
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Liaoning and Jiangxi is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Liaoning Dingjide Petrochemica and Jiangxi Selon Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi Selon Industrial and Liaoning Dingjide 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 Liaoning Dingjide Petrochemical are associated (or correlated) with Jiangxi Selon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi Selon Industrial has no effect on the direction of Liaoning Dingjide i.e., Liaoning Dingjide and Jiangxi Selon go up and down completely randomly.
Pair Corralation between Liaoning Dingjide and Jiangxi Selon
Assuming the 90 days trading horizon Liaoning Dingjide is expected to generate 2.68 times less return on investment than Jiangxi Selon. In addition to that, Liaoning Dingjide is 1.45 times more volatile than Jiangxi Selon Industrial. It trades about 0.06 of its total potential returns per unit of risk. Jiangxi Selon Industrial is currently generating about 0.22 per unit of volatility. If you would invest 595.00 in Jiangxi Selon Industrial on October 24, 2024 and sell it today you would earn a total of 212.00 from holding Jiangxi Selon Industrial or generate 35.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liaoning Dingjide Petrochemica vs. Jiangxi Selon Industrial
Performance |
| Timeline |
| Liaoning Dingjide |
| Jiangxi Selon Industrial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
Liaoning Dingjide and Jiangxi Selon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liaoning Dingjide and Jiangxi Selon
The main advantage of trading using opposite Liaoning Dingjide and Jiangxi Selon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liaoning Dingjide position performs unexpectedly, Jiangxi Selon 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 Jiangxi Selon will offset losses from the drop in Jiangxi Selon's long position.| Liaoning Dingjide vs. Qingdao Foods Co | Liaoning Dingjide vs. Anji Foodstuff Co | Liaoning Dingjide vs. Guilin Seamild Foods | Liaoning Dingjide vs. Jiahe Foods Industry |
| Jiangxi Selon vs. JS Corrugating Machinery | Jiangxi Selon vs. Shandong Sanyuan Biotechnology | Jiangxi Selon vs. Huasi Agricultural Development | Jiangxi Selon vs. Gifore Agricultural 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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