Correlation Between Jinhui Liquor and LianChuang Electronic
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By analyzing existing cross correlation between Jinhui Liquor Co and LianChuang Electronic Technology, you can compare the effects of market volatilities on Jinhui Liquor and LianChuang Electronic 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 LianChuang Electronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinhui Liquor and LianChuang Electronic.
Diversification Opportunities for Jinhui Liquor and LianChuang Electronic
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jinhui and LianChuang is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Jinhui Liquor Co and LianChuang Electronic Technolo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LianChuang Electronic 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 LianChuang Electronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LianChuang Electronic has no effect on the direction of Jinhui Liquor i.e., Jinhui Liquor and LianChuang Electronic go up and down completely randomly.
Pair Corralation between Jinhui Liquor and LianChuang Electronic
Assuming the 90 days trading horizon Jinhui Liquor Co is expected to under-perform the LianChuang Electronic. But the stock apears to be less risky and, when comparing its historical volatility, Jinhui Liquor Co is 1.54 times less risky than LianChuang Electronic. The stock trades about -0.02 of its potential returns per unit of risk. The LianChuang Electronic Technology is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 1,383 in LianChuang Electronic Technology on October 15, 2024 and sell it today you would lose (513.00) from holding LianChuang Electronic Technology or give up 37.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinhui Liquor Co vs. LianChuang Electronic Technolo
Performance |
| Timeline |
| Jinhui Liquor |
| LianChuang Electronic |
Jinhui Liquor and LianChuang Electronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinhui Liquor and LianChuang Electronic
The main advantage of trading using opposite Jinhui Liquor and LianChuang Electronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinhui Liquor position performs unexpectedly, LianChuang Electronic 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 LianChuang Electronic will offset losses from the drop in LianChuang Electronic's long position.| Jinhui Liquor vs. Weichai Heavy Machinery | Jinhui Liquor vs. Shuhua Sports Co | Jinhui Liquor vs. Zhejiang Yinlun Machinery | Jinhui Liquor vs. Shenzhen Zhongzhuang Construction |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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