Correlation Between Jiangsu Pacific and Liaoning Chengda
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By analyzing existing cross correlation between Jiangsu Pacific Quartz and Liaoning Chengda Biotechnology, you can compare the effects of market volatilities on Jiangsu Pacific and Liaoning Chengda 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 Liaoning Chengda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Pacific and Liaoning Chengda.
Diversification Opportunities for Jiangsu Pacific and Liaoning Chengda
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jiangsu and Liaoning is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Pacific Quartz and Liaoning Chengda Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liaoning Chengda Bio 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 Liaoning Chengda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liaoning Chengda Bio has no effect on the direction of Jiangsu Pacific i.e., Jiangsu Pacific and Liaoning Chengda go up and down completely randomly.
Pair Corralation between Jiangsu Pacific and Liaoning Chengda
Assuming the 90 days trading horizon Jiangsu Pacific Quartz is expected to under-perform the Liaoning Chengda. In addition to that, Jiangsu Pacific is 1.53 times more volatile than Liaoning Chengda Biotechnology. It trades about -0.01 of its total potential returns per unit of risk. Liaoning Chengda Biotechnology is currently generating about 0.08 per unit of volatility. If you would invest 2,723 in Liaoning Chengda Biotechnology on September 4, 2024 and sell it today you would earn a total of 66.00 from holding Liaoning Chengda Biotechnology or generate 2.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Pacific Quartz vs. Liaoning Chengda Biotechnology
Performance |
| Timeline |
| Jiangsu Pacific Quartz |
| Liaoning Chengda Bio |
Jiangsu Pacific and Liaoning Chengda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Pacific and Liaoning Chengda
The main advantage of trading using opposite Jiangsu Pacific and Liaoning Chengda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Pacific position performs unexpectedly, Liaoning Chengda 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 Liaoning Chengda will offset losses from the drop in Liaoning Chengda's long position.| Jiangsu Pacific vs. Guangdong Jingyi Metal | Jiangsu Pacific vs. King Strong New Material | Jiangsu Pacific vs. Orinko Advanced Plastics | Jiangsu Pacific vs. Ye Chiu Metal |
| Liaoning Chengda vs. Kweichow Moutai Co | Liaoning Chengda vs. Shenzhen Mindray Bio Medical | Liaoning Chengda vs. Jiangsu Pacific Quartz | Liaoning Chengda vs. G bits Network Technology |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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