Correlation Between Lutian Machinery and Jonjee Hi-tech
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By analyzing existing cross correlation between Lutian Machinery Co and Jonjee Hi tech Industrial, you can compare the effects of market volatilities on Lutian Machinery and Jonjee Hi-tech 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 Jonjee Hi-tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lutian Machinery and Jonjee Hi-tech.
Diversification Opportunities for Lutian Machinery and Jonjee Hi-tech
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lutian and Jonjee is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Lutian Machinery Co and Jonjee Hi tech Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jonjee Hi tech 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 Jonjee Hi-tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jonjee Hi tech has no effect on the direction of Lutian Machinery i.e., Lutian Machinery and Jonjee Hi-tech go up and down completely randomly.
Pair Corralation between Lutian Machinery and Jonjee Hi-tech
Assuming the 90 days trading horizon Lutian Machinery is expected to generate 1.55 times less return on investment than Jonjee Hi-tech. But when comparing it to its historical volatility, Lutian Machinery Co is 1.35 times less risky than Jonjee Hi-tech. It trades about 0.16 of its potential returns per unit of risk. Jonjee Hi tech Industrial is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,677 in Jonjee Hi tech Industrial on September 2, 2024 and sell it today you would earn a total of 676.00 from holding Jonjee Hi tech Industrial or generate 40.31% 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. Jonjee Hi tech Industrial
Performance |
| Timeline |
| Lutian Machinery |
| Jonjee Hi tech |
Lutian Machinery and Jonjee Hi-tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lutian Machinery and Jonjee Hi-tech
The main advantage of trading using opposite Lutian Machinery and Jonjee Hi-tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lutian Machinery position performs unexpectedly, Jonjee Hi-tech 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 Jonjee Hi-tech will offset losses from the drop in Jonjee Hi-tech's long position.| Lutian Machinery vs. Hangzhou Gaoxin Rubber | Lutian Machinery vs. Chengtun Mining Group | Lutian Machinery vs. Eastern Air Logistics | Lutian Machinery vs. Suzhou Xingye Material |
| Jonjee Hi-tech vs. Nanjing Putian Telecommunications | Jonjee Hi-tech vs. Shenzhen Hifuture Electric | Jonjee Hi-tech vs. Tianjin Realty Development | Jonjee Hi-tech vs. Shenyang Huitian Thermal |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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