Correlation Between Lutian Machinery and Jiangsu Jinling
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By analyzing existing cross correlation between Lutian Machinery Co and Jiangsu Jinling Sports, you can compare the effects of market volatilities on Lutian Machinery and Jiangsu Jinling 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 Lutian Machinery with a short position of Jiangsu Jinling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lutian Machinery and Jiangsu Jinling.
Diversification Opportunities for Lutian Machinery and Jiangsu Jinling
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lutian and Jiangsu is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Lutian Machinery Co and Jiangsu Jinling Sports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Jinling Sports and Lutian Machinery 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 Lutian Machinery Co are associated (or correlated) with Jiangsu Jinling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Jinling Sports has no effect on the direction of Lutian Machinery i.e., Lutian Machinery and Jiangsu Jinling go up and down completely randomly.
Pair Corralation between Lutian Machinery and Jiangsu Jinling
Assuming the 90 days trading horizon Lutian Machinery is expected to generate 1.58 times less return on investment than Jiangsu Jinling. But when comparing it to its historical volatility, Lutian Machinery Co is 1.41 times less risky than Jiangsu Jinling. It trades about 0.09 of its potential returns per unit of risk. Jiangsu Jinling Sports is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,444 in Jiangsu Jinling Sports on September 13, 2024 and sell it today you would earn a total of 73.00 from holding Jiangsu Jinling Sports or generate 5.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lutian Machinery Co vs. Jiangsu Jinling Sports
Performance |
| Timeline |
| Lutian Machinery |
| Jiangsu Jinling Sports |
Lutian Machinery and Jiangsu Jinling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lutian Machinery and Jiangsu Jinling
The main advantage of trading using opposite Lutian Machinery and Jiangsu Jinling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lutian Machinery position performs unexpectedly, Jiangsu Jinling 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 Jinling will offset losses from the drop in Jiangsu Jinling's long position.| Lutian Machinery vs. Industrial and Commercial | Lutian Machinery vs. Kweichow Moutai Co | Lutian Machinery vs. Agricultural Bank of | Lutian Machinery vs. China Mobile Limited |
| Jiangsu Jinling vs. Lutian Machinery Co | Jiangsu Jinling vs. China Longyuan Power | Jiangsu Jinling vs. PetroChina Co Ltd | Jiangsu Jinling vs. Bank of China |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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