Correlation Between Jiahe Foods and Hainan Mining
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By analyzing existing cross correlation between Jiahe Foods Industry and Hainan Mining Co, you can compare the effects of market volatilities on Jiahe Foods and Hainan Mining 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 Hainan Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiahe Foods and Hainan Mining.
Diversification Opportunities for Jiahe Foods and Hainan Mining
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiahe and Hainan is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Jiahe Foods Industry and Hainan Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hainan Mining 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 Hainan Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hainan Mining has no effect on the direction of Jiahe Foods i.e., Jiahe Foods and Hainan Mining go up and down completely randomly.
Pair Corralation between Jiahe Foods and Hainan Mining
Assuming the 90 days trading horizon Jiahe Foods Industry is expected to generate 1.62 times more return on investment than Hainan Mining. However, Jiahe Foods is 1.62 times more volatile than Hainan Mining Co. It trades about -0.02 of its potential returns per unit of risk. Hainan Mining Co is currently generating about -0.26 per unit of risk. If you would invest 1,318 in Jiahe Foods Industry on October 23, 2024 and sell it today you would lose (32.00) from holding Jiahe Foods Industry or give up 2.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Jiahe Foods Industry vs. Hainan Mining Co
Performance |
| Timeline |
| Jiahe Foods Industry |
| Hainan Mining |
Jiahe Foods and Hainan Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiahe Foods and Hainan Mining
The main advantage of trading using opposite Jiahe Foods and Hainan Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiahe Foods position performs unexpectedly, Hainan Mining 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 Hainan Mining will offset losses from the drop in Hainan Mining's long position.| Jiahe Foods vs. City Development Environment | Jiahe Foods vs. Hangzhou Guotai Environmental | Jiahe Foods vs. Angang Steel Co | Jiahe Foods vs. Sportsoul Co Ltd |
| Hainan Mining vs. Dongfeng Automobile Co | Hainan Mining vs. Central Plains Environment | Hainan Mining vs. Fujian Nanwang Environment | Hainan Mining vs. Baoshan Iron Steel |
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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