Correlation Between Xiangpiaopiao Food and Jiangsu GDK
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By analyzing existing cross correlation between Xiangpiaopiao Food Co and Jiangsu GDK Biotechnology, you can compare the effects of market volatilities on Xiangpiaopiao Food and Jiangsu GDK 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 Xiangpiaopiao Food with a short position of Jiangsu GDK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangpiaopiao Food and Jiangsu GDK.
Diversification Opportunities for Xiangpiaopiao Food and Jiangsu GDK
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Xiangpiaopiao and Jiangsu is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Xiangpiaopiao Food Co and Jiangsu GDK Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu GDK Biotechnology and Xiangpiaopiao Food 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 Xiangpiaopiao Food Co are associated (or correlated) with Jiangsu GDK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu GDK Biotechnology has no effect on the direction of Xiangpiaopiao Food i.e., Xiangpiaopiao Food and Jiangsu GDK go up and down completely randomly.
Pair Corralation between Xiangpiaopiao Food and Jiangsu GDK
Assuming the 90 days trading horizon Xiangpiaopiao Food Co is expected to under-perform the Jiangsu GDK. In addition to that, Xiangpiaopiao Food is 1.21 times more volatile than Jiangsu GDK Biotechnology. It trades about -0.05 of its total potential returns per unit of risk. Jiangsu GDK Biotechnology is currently generating about 0.06 per unit of volatility. If you would invest 1,183 in Jiangsu GDK Biotechnology on November 8, 2024 and sell it today you would earn a total of 28.00 from holding Jiangsu GDK Biotechnology or generate 2.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangpiaopiao Food Co vs. Jiangsu GDK Biotechnology
Performance |
| Timeline |
| Xiangpiaopiao Food |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Jiangsu GDK Biotechnology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Xiangpiaopiao Food and Jiangsu GDK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangpiaopiao Food and Jiangsu GDK
The main advantage of trading using opposite Xiangpiaopiao Food and Jiangsu GDK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangpiaopiao Food position performs unexpectedly, Jiangsu GDK 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 Jiangsu GDK will offset losses from the drop in Jiangsu GDK's long position.The idea behind Xiangpiaopiao Food Co and Jiangsu GDK Biotechnology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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