Correlation Between Jiahe Foods and Liaoning Dingjide
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By analyzing existing cross correlation between Jiahe Foods Industry and Liaoning Dingjide Petrochemical, you can compare the effects of market volatilities on Jiahe Foods and Liaoning Dingjide 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 Liaoning Dingjide. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiahe Foods and Liaoning Dingjide.
Diversification Opportunities for Jiahe Foods and Liaoning Dingjide
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jiahe and Liaoning is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Jiahe Foods Industry and Liaoning Dingjide Petrochemica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liaoning Dingjide 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 Liaoning Dingjide. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liaoning Dingjide has no effect on the direction of Jiahe Foods i.e., Jiahe Foods and Liaoning Dingjide go up and down completely randomly.
Pair Corralation between Jiahe Foods and Liaoning Dingjide
Assuming the 90 days trading horizon Jiahe Foods Industry is expected to generate 0.71 times more return on investment than Liaoning Dingjide. However, Jiahe Foods Industry is 1.4 times less risky than Liaoning Dingjide. It trades about -0.14 of its potential returns per unit of risk. Liaoning Dingjide Petrochemical is currently generating about -0.14 per unit of risk. If you would invest 1,387 in Jiahe Foods Industry on November 3, 2024 and sell it today you would lose (112.00) from holding Jiahe Foods Industry or give up 8.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiahe Foods Industry vs. Liaoning Dingjide Petrochemica
Performance |
| Timeline |
| Jiahe Foods Industry |
| Liaoning Dingjide |
Jiahe Foods and Liaoning Dingjide Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiahe Foods and Liaoning Dingjide
The main advantage of trading using opposite Jiahe Foods and Liaoning Dingjide positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiahe Foods position performs unexpectedly, Liaoning Dingjide 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 Liaoning Dingjide will offset losses from the drop in Liaoning Dingjide's long position.| Jiahe Foods vs. Beijing Seeyon Internet | Jiahe Foods vs. Offshore Oil Engineering | Jiahe Foods vs. Maxvision Technology Corp | Jiahe Foods vs. Strait Innovation Internet |
| Liaoning Dingjide vs. Fibocom Wireless | Liaoning Dingjide vs. Beijing Kingsoft Office | Liaoning Dingjide vs. Lutian Machinery Co | Liaoning Dingjide vs. Senci Electric Machinery |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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