Correlation Between Beijing Wantai and Jiajia Food
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By analyzing existing cross correlation between Beijing Wantai Biological and Jiajia Food Group, you can compare the effects of market volatilities on Beijing Wantai and Jiajia Food 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 Beijing Wantai with a short position of Jiajia Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Wantai and Jiajia Food.
Diversification Opportunities for Beijing Wantai and Jiajia Food
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Beijing and Jiajia is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Wantai Biological and Jiajia Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiajia Food Group and Beijing Wantai 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 Beijing Wantai Biological are associated (or correlated) with Jiajia Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiajia Food Group has no effect on the direction of Beijing Wantai i.e., Beijing Wantai and Jiajia Food go up and down completely randomly.
Pair Corralation between Beijing Wantai and Jiajia Food
Assuming the 90 days trading horizon Beijing Wantai Biological is expected to generate 0.94 times more return on investment than Jiajia Food. However, Beijing Wantai Biological is 1.06 times less risky than Jiajia Food. It trades about 0.06 of its potential returns per unit of risk. Jiajia Food Group is currently generating about 0.03 per unit of risk. If you would invest 4,689 in Beijing Wantai Biological on September 4, 2024 and sell it today you would earn a total of 2,561 from holding Beijing Wantai Biological or generate 54.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Wantai Biological vs. Jiajia Food Group
Performance |
| Timeline |
| Beijing Wantai Biological |
| Jiajia Food Group |
Beijing Wantai and Jiajia Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Wantai and Jiajia Food
The main advantage of trading using opposite Beijing Wantai and Jiajia Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Wantai position performs unexpectedly, Jiajia Food 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 Jiajia Food will offset losses from the drop in Jiajia Food's long position.| Beijing Wantai vs. Hubeiyichang Transportation Group | Beijing Wantai vs. Jiangsu Jinling Sports | Beijing Wantai vs. Sino Platinum Metals Co | Beijing Wantai vs. Qinghaihuading Industrial Co |
| Jiajia Food vs. Poly Real Estate | Jiajia Food vs. China Vanke Co | Jiajia Food vs. China Merchants Shekou | Jiajia Food vs. Huafa Industrial Co |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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