Correlation Between Jinhui Liquor and Weichai Heavy
Specify exactly 2 symbols:
By analyzing existing cross correlation between Jinhui Liquor Co and Weichai Heavy Machinery, you can compare the effects of market volatilities on Jinhui Liquor and Weichai Heavy 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 Jinhui Liquor with a short position of Weichai Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinhui Liquor and Weichai Heavy.
Diversification Opportunities for Jinhui Liquor and Weichai Heavy
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Jinhui and Weichai is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Jinhui Liquor Co and Weichai Heavy Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weichai Heavy Machinery and Jinhui Liquor 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 Jinhui Liquor Co are associated (or correlated) with Weichai Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weichai Heavy Machinery has no effect on the direction of Jinhui Liquor i.e., Jinhui Liquor and Weichai Heavy go up and down completely randomly.
Pair Corralation between Jinhui Liquor and Weichai Heavy
Assuming the 90 days trading horizon Jinhui Liquor Co is expected to under-perform the Weichai Heavy. But the stock apears to be less risky and, when comparing its historical volatility, Jinhui Liquor Co is 3.87 times less risky than Weichai Heavy. The stock trades about -0.16 of its potential returns per unit of risk. The Weichai Heavy Machinery is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,827 in Weichai Heavy Machinery on October 30, 2024 and sell it today you would earn a total of 167.00 from holding Weichai Heavy Machinery or generate 9.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinhui Liquor Co vs. Weichai Heavy Machinery
Performance |
| Timeline |
| Jinhui Liquor |
| Weichai Heavy Machinery |
Jinhui Liquor and Weichai Heavy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinhui Liquor and Weichai Heavy
The main advantage of trading using opposite Jinhui Liquor and Weichai Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinhui Liquor position performs unexpectedly, Weichai Heavy 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 Weichai Heavy will offset losses from the drop in Weichai Heavy's long position.| Jinhui Liquor vs. Xinjiang Beixin RoadBridge | Jinhui Liquor vs. Guangdong Transtek Medical | Jinhui Liquor vs. Road Environment Technology | Jinhui Liquor vs. Shaanxi Broadcast TV |
| Weichai Heavy vs. Guangzhou Tinci Materials | Weichai Heavy vs. Sharetronic Data Technology | Weichai Heavy vs. Biwin Storage Technology | Weichai Heavy vs. Qiming Information 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |