Correlation Between Jiangsu Pacific and Aerospace
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By analyzing existing cross correlation between Jiangsu Pacific Quartz and Aerospace Hi Tech Holding, you can compare the effects of market volatilities on Jiangsu Pacific and Aerospace 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 Jiangsu Pacific with a short position of Aerospace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Pacific and Aerospace.
Diversification Opportunities for Jiangsu Pacific and Aerospace
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiangsu and Aerospace is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Pacific Quartz and Aerospace Hi Tech Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aerospace Hi Tech and Jiangsu Pacific 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 Jiangsu Pacific Quartz are associated (or correlated) with Aerospace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aerospace Hi Tech has no effect on the direction of Jiangsu Pacific i.e., Jiangsu Pacific and Aerospace go up and down completely randomly.
Pair Corralation between Jiangsu Pacific and Aerospace
Assuming the 90 days trading horizon Jiangsu Pacific Quartz is expected to under-perform the Aerospace. But the stock apears to be less risky and, when comparing its historical volatility, Jiangsu Pacific Quartz is 1.23 times less risky than Aerospace. The stock trades about -0.05 of its potential returns per unit of risk. The Aerospace Hi Tech Holding is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 838.00 in Aerospace Hi Tech Holding on September 3, 2024 and sell it today you would earn a total of 355.00 from holding Aerospace Hi Tech Holding or generate 42.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Pacific Quartz vs. Aerospace Hi Tech Holding
Performance |
| Timeline |
| Jiangsu Pacific Quartz |
| Aerospace Hi Tech |
Jiangsu Pacific and Aerospace Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Pacific and Aerospace
The main advantage of trading using opposite Jiangsu Pacific and Aerospace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Pacific position performs unexpectedly, Aerospace 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 Aerospace will offset losses from the drop in Aerospace's long position.| Jiangsu Pacific vs. Railway Signal Communication | Jiangsu Pacific vs. Chengdu Xinzhu RoadBridge | Jiangsu Pacific vs. Hainan Haiqi Transportation | Jiangsu Pacific vs. RoadMain T Co |
| Aerospace vs. PetroChina Co Ltd | Aerospace vs. China Mobile Limited | Aerospace vs. Industrial and Commercial | Aerospace vs. China Life Insurance |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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