Correlation Between Jiahe Foods and Chongqing Road
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By analyzing existing cross correlation between Jiahe Foods Industry and Chongqing Road Bridge, you can compare the effects of market volatilities on Jiahe Foods and Chongqing Road 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 Jiahe Foods with a short position of Chongqing Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiahe Foods and Chongqing Road.
Diversification Opportunities for Jiahe Foods and Chongqing Road
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiahe and Chongqing is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Jiahe Foods Industry and Chongqing Road Bridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Road Bridge and Jiahe Foods 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 Jiahe Foods Industry are associated (or correlated) with Chongqing Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Road Bridge has no effect on the direction of Jiahe Foods i.e., Jiahe Foods and Chongqing Road go up and down completely randomly.
Pair Corralation between Jiahe Foods and Chongqing Road
Assuming the 90 days trading horizon Jiahe Foods Industry is expected to under-perform the Chongqing Road. But the stock apears to be less risky and, when comparing its historical volatility, Jiahe Foods Industry is 1.17 times less risky than Chongqing Road. The stock trades about 0.0 of its potential returns per unit of risk. The Chongqing Road Bridge is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 469.00 in Chongqing Road Bridge on September 4, 2024 and sell it today you would earn a total of 213.00 from holding Chongqing Road Bridge or generate 45.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiahe Foods Industry vs. Chongqing Road Bridge
Performance |
| Timeline |
| Jiahe Foods Industry |
| Chongqing Road Bridge |
Jiahe Foods and Chongqing Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiahe Foods and Chongqing Road
The main advantage of trading using opposite Jiahe Foods and Chongqing Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiahe Foods position performs unexpectedly, Chongqing Road 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 Chongqing Road will offset losses from the drop in Chongqing Road's long position.| Jiahe Foods vs. Poly Real Estate | Jiahe Foods vs. China Vanke Co | Jiahe Foods vs. China Merchants Shekou | Jiahe Foods vs. Huafa Industrial Co |
| Chongqing Road vs. Zhongtong Guomai Communication | Chongqing Road vs. XinJiang GuoTong Pipeline | Chongqing Road vs. Jiaozuo Wanfang Aluminum | Chongqing Road vs. Tongyu Communication |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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