Correlation Between Jinhui Liquor and Loongson Technology
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By analyzing existing cross correlation between Jinhui Liquor Co and Loongson Technology Corp, you can compare the effects of market volatilities on Jinhui Liquor and Loongson Technology 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 Loongson Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinhui Liquor and Loongson Technology.
Diversification Opportunities for Jinhui Liquor and Loongson Technology
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jinhui and Loongson is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Jinhui Liquor Co and Loongson Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loongson Technology Corp 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 Loongson Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loongson Technology Corp has no effect on the direction of Jinhui Liquor i.e., Jinhui Liquor and Loongson Technology go up and down completely randomly.
Pair Corralation between Jinhui Liquor and Loongson Technology
Assuming the 90 days trading horizon Jinhui Liquor Co is expected to under-perform the Loongson Technology. But the stock apears to be less risky and, when comparing its historical volatility, Jinhui Liquor Co is 1.45 times less risky than Loongson Technology. The stock trades about -0.08 of its potential returns per unit of risk. The Loongson Technology Corp is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 13,835 in Loongson Technology Corp on August 29, 2024 and sell it today you would earn a total of 1,444 from holding Loongson Technology Corp or generate 10.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinhui Liquor Co vs. Loongson Technology Corp
Performance |
| Timeline |
| Jinhui Liquor |
| Loongson Technology Corp |
Jinhui Liquor and Loongson Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinhui Liquor and Loongson Technology
The main advantage of trading using opposite Jinhui Liquor and Loongson Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinhui Liquor position performs unexpectedly, Loongson Technology 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 Loongson Technology will offset losses from the drop in Loongson Technology's long position.| Jinhui Liquor vs. PetroChina Co Ltd | Jinhui Liquor vs. China Mobile Limited | Jinhui Liquor vs. Ping An Insurance | Jinhui Liquor vs. China Petroleum Chemical |
| Loongson Technology vs. Jinhui Liquor Co | Loongson Technology vs. Lander Sports Development | Loongson Technology vs. Inly Media Co | Loongson Technology vs. Shenzhen Clou Electronics |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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