Correlation Between Zhejiang Yongjin and Jiangsu GDK
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By analyzing existing cross correlation between Zhejiang Yongjin Metal and Jiangsu GDK Biotechnology, you can compare the effects of market volatilities on Zhejiang Yongjin 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 Zhejiang Yongjin with a short position of Jiangsu GDK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Yongjin and Jiangsu GDK.
Diversification Opportunities for Zhejiang Yongjin and Jiangsu GDK
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhejiang and Jiangsu is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Yongjin Metal 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 Zhejiang Yongjin 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 Zhejiang Yongjin Metal 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 Zhejiang Yongjin i.e., Zhejiang Yongjin and Jiangsu GDK go up and down completely randomly.
Pair Corralation between Zhejiang Yongjin and Jiangsu GDK
Assuming the 90 days trading horizon Zhejiang Yongjin is expected to generate 13.82 times less return on investment than Jiangsu GDK. But when comparing it to its historical volatility, Zhejiang Yongjin Metal is 2.01 times less risky than Jiangsu GDK. It trades about 0.04 of its potential returns per unit of risk. Jiangsu GDK Biotechnology is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 1,357 in Jiangsu GDK Biotechnology on September 1, 2024 and sell it today you would earn a total of 311.00 from holding Jiangsu GDK Biotechnology or generate 22.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Yongjin Metal vs. Jiangsu GDK Biotechnology
Performance |
| Timeline |
| Zhejiang Yongjin Metal |
| Jiangsu GDK Biotechnology |
Zhejiang Yongjin and Jiangsu GDK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Yongjin and Jiangsu GDK
The main advantage of trading using opposite Zhejiang Yongjin and Jiangsu GDK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Yongjin 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.| Zhejiang Yongjin vs. Jiangsu GDK Biotechnology | Zhejiang Yongjin vs. Southern PublishingMedia Co | Zhejiang Yongjin vs. Sunny Loan Top | Zhejiang Yongjin vs. Shanghai Metersbonwe FashionAccessories |
| Jiangsu GDK vs. PetroChina Co Ltd | Jiangsu GDK vs. China Mobile Limited | Jiangsu GDK vs. CNOOC Limited | Jiangsu GDK vs. Ping An Insurance |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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