Correlation Between Lutian Machinery and Jiangsu Financial
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By analyzing existing cross correlation between Lutian Machinery Co and Jiangsu Financial Leasing, you can compare the effects of market volatilities on Lutian Machinery and Jiangsu Financial 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 Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lutian Machinery and Jiangsu Financial.
Diversification Opportunities for Lutian Machinery and Jiangsu Financial
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Lutian and Jiangsu is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Lutian Machinery Co and Jiangsu Financial Leasing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Financial Leasing 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 Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Financial Leasing has no effect on the direction of Lutian Machinery i.e., Lutian Machinery and Jiangsu Financial go up and down completely randomly.
Pair Corralation between Lutian Machinery and Jiangsu Financial
Assuming the 90 days trading horizon Lutian Machinery Co is expected to under-perform the Jiangsu Financial. In addition to that, Lutian Machinery is 1.19 times more volatile than Jiangsu Financial Leasing. It trades about -0.01 of its total potential returns per unit of risk. Jiangsu Financial Leasing is currently generating about 0.04 per unit of volatility. If you would invest 398.00 in Jiangsu Financial Leasing on October 26, 2024 and sell it today you would earn a total of 129.00 from holding Jiangsu Financial Leasing or generate 32.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lutian Machinery Co vs. Jiangsu Financial Leasing
Performance |
| Timeline |
| Lutian Machinery |
| Jiangsu Financial Leasing |
Lutian Machinery and Jiangsu Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lutian Machinery and Jiangsu Financial
The main advantage of trading using opposite Lutian Machinery and Jiangsu Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lutian Machinery position performs unexpectedly, Jiangsu Financial 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 Financial will offset losses from the drop in Jiangsu Financial's long position.| Lutian Machinery vs. PetroChina Co Ltd | Lutian Machinery vs. Industrial and Commercial | Lutian Machinery vs. China Petroleum Chemical | Lutian Machinery vs. China Construction Bank |
| Jiangsu Financial vs. Xinjiang Baodi Mining | Jiangsu Financial vs. Tonghua Grape Wine | Jiangsu Financial vs. Beingmate Baby Child | Jiangsu Financial vs. ZYF Lopsking Aluminum |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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