Correlation Between Jingjin Environmental and Ligao Foods
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By analyzing existing cross correlation between Jingjin Environmental Protection and Ligao Foods CoLtd, you can compare the effects of market volatilities on Jingjin Environmental and Ligao Foods 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 Jingjin Environmental with a short position of Ligao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jingjin Environmental and Ligao Foods.
Diversification Opportunities for Jingjin Environmental and Ligao Foods
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jingjin and Ligao is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Jingjin Environmental Protecti and Ligao Foods CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ligao Foods CoLtd and Jingjin Environmental 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 Jingjin Environmental Protection are associated (or correlated) with Ligao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ligao Foods CoLtd has no effect on the direction of Jingjin Environmental i.e., Jingjin Environmental and Ligao Foods go up and down completely randomly.
Pair Corralation between Jingjin Environmental and Ligao Foods
Assuming the 90 days trading horizon Jingjin Environmental Protection is expected to under-perform the Ligao Foods. But the stock apears to be less risky and, when comparing its historical volatility, Jingjin Environmental Protection is 1.46 times less risky than Ligao Foods. The stock trades about -0.03 of its potential returns per unit of risk. The Ligao Foods CoLtd is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 5,397 in Ligao Foods CoLtd on September 14, 2024 and sell it today you would lose (747.00) from holding Ligao Foods CoLtd or give up 13.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.62% |
| Values | Daily Returns |
Jingjin Environmental Protecti vs. Ligao Foods CoLtd
Performance |
| Timeline |
| Jingjin Environmental |
| Ligao Foods CoLtd |
Jingjin Environmental and Ligao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jingjin Environmental and Ligao Foods
The main advantage of trading using opposite Jingjin Environmental and Ligao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jingjin Environmental position performs unexpectedly, Ligao Foods 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 Ligao Foods will offset losses from the drop in Ligao Foods' long position.| Jingjin Environmental vs. Ligao Foods CoLtd | Jingjin Environmental vs. Shandong Homey Aquatic | Jingjin Environmental vs. Der International Home | Jingjin Environmental vs. Mengtian Home Group |
| Ligao Foods vs. Nanjing Putian Telecommunications | Ligao Foods vs. Tianjin Realty Development | Ligao Foods vs. Kangyue Technology Co | Ligao Foods vs. Shenzhen Hifuture Electric |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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