Correlation Between Jinhui Liquor and Lutian Machinery
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By analyzing existing cross correlation between Jinhui Liquor Co and Lutian Machinery Co, you can compare the effects of market volatilities on Jinhui Liquor and Lutian Machinery 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 Lutian Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinhui Liquor and Lutian Machinery.
Diversification Opportunities for Jinhui Liquor and Lutian Machinery
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jinhui and Lutian is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Jinhui Liquor Co and Lutian Machinery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lutian 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 Lutian Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lutian Machinery has no effect on the direction of Jinhui Liquor i.e., Jinhui Liquor and Lutian Machinery go up and down completely randomly.
Pair Corralation between Jinhui Liquor and Lutian Machinery
Assuming the 90 days trading horizon Jinhui Liquor Co is expected to under-perform the Lutian Machinery. In addition to that, Jinhui Liquor is 1.11 times more volatile than Lutian Machinery Co. It trades about -0.02 of its total potential returns per unit of risk. Lutian Machinery Co is currently generating about -0.01 per unit of volatility. If you would invest 1,752 in Lutian Machinery Co on October 11, 2024 and sell it today you would lose (248.00) from holding Lutian Machinery Co or give up 14.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinhui Liquor Co vs. Lutian Machinery Co
Performance |
| Timeline |
| Jinhui Liquor |
| Lutian Machinery |
Jinhui Liquor and Lutian Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinhui Liquor and Lutian Machinery
The main advantage of trading using opposite Jinhui Liquor and Lutian Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinhui Liquor position performs unexpectedly, Lutian Machinery 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 Lutian Machinery will offset losses from the drop in Lutian Machinery's long position.| Jinhui Liquor vs. Sunny Loan Top | Jinhui Liquor vs. Xinxiang Chemical Fiber | Jinhui Liquor vs. Wuxi Chemical Equipment | Jinhui Liquor vs. Semiconductor Manufacturing Intl |
| Lutian Machinery vs. Xiamen Jihong Package | Lutian Machinery vs. Youyou Foods Co | Lutian Machinery vs. Jinhui Liquor Co | Lutian Machinery vs. Zhangjiagang Freetrade Science |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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