Correlation Between Youyou Foods and Jilin Chemical
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By analyzing existing cross correlation between Youyou Foods Co and Jilin Chemical Fibre, you can compare the effects of market volatilities on Youyou Foods and Jilin Chemical 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 Youyou Foods with a short position of Jilin Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youyou Foods and Jilin Chemical.
Diversification Opportunities for Youyou Foods and Jilin Chemical
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Youyou and Jilin is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Youyou Foods Co and Jilin Chemical Fibre in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jilin Chemical Fibre and Youyou Foods 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 Youyou Foods Co are associated (or correlated) with Jilin Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jilin Chemical Fibre has no effect on the direction of Youyou Foods i.e., Youyou Foods and Jilin Chemical go up and down completely randomly.
Pair Corralation between Youyou Foods and Jilin Chemical
Assuming the 90 days trading horizon Youyou Foods Co is expected to generate 1.65 times more return on investment than Jilin Chemical. However, Youyou Foods is 1.65 times more volatile than Jilin Chemical Fibre. It trades about 0.25 of its potential returns per unit of risk. Jilin Chemical Fibre is currently generating about -0.12 per unit of risk. If you would invest 930.00 in Youyou Foods Co on September 3, 2024 and sell it today you would earn a total of 212.00 from holding Youyou Foods Co or generate 22.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Youyou Foods Co vs. Jilin Chemical Fibre
Performance |
| Timeline |
| Youyou Foods |
| Jilin Chemical Fibre |
Youyou Foods and Jilin Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youyou Foods and Jilin Chemical
The main advantage of trading using opposite Youyou Foods and Jilin Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youyou Foods position performs unexpectedly, Jilin Chemical 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 Jilin Chemical will offset losses from the drop in Jilin Chemical's long position.| Youyou Foods vs. Beijing Wantai Biological | Youyou Foods vs. Aluminum Corp of | Youyou Foods vs. COL Digital Publishing | Youyou Foods vs. Shaanxi Meineng Clean |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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