Correlation Between Loongson Technology and Yunnan Jianzhijia
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By analyzing existing cross correlation between Loongson Technology Corp and Yunnan Jianzhijia Health Chain, you can compare the effects of market volatilities on Loongson Technology and Yunnan Jianzhijia 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 Loongson Technology with a short position of Yunnan Jianzhijia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loongson Technology and Yunnan Jianzhijia.
Diversification Opportunities for Loongson Technology and Yunnan Jianzhijia
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Loongson and Yunnan is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Loongson Technology Corp and Yunnan Jianzhijia Health Chain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yunnan Jianzhijia and Loongson Technology 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 Loongson Technology Corp are associated (or correlated) with Yunnan Jianzhijia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yunnan Jianzhijia has no effect on the direction of Loongson Technology i.e., Loongson Technology and Yunnan Jianzhijia go up and down completely randomly.
Pair Corralation between Loongson Technology and Yunnan Jianzhijia
Assuming the 90 days trading horizon Loongson Technology Corp is expected to generate 1.03 times more return on investment than Yunnan Jianzhijia. However, Loongson Technology is 1.03 times more volatile than Yunnan Jianzhijia Health Chain. It trades about 0.26 of its potential returns per unit of risk. Yunnan Jianzhijia Health Chain is currently generating about 0.03 per unit of risk. If you would invest 12,923 in Loongson Technology Corp on September 4, 2024 and sell it today you would earn a total of 2,967 from holding Loongson Technology Corp or generate 22.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Loongson Technology Corp vs. Yunnan Jianzhijia Health Chain
Performance |
| Timeline |
| Loongson Technology Corp |
| Yunnan Jianzhijia |
Loongson Technology and Yunnan Jianzhijia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loongson Technology and Yunnan Jianzhijia
The main advantage of trading using opposite Loongson Technology and Yunnan Jianzhijia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loongson Technology position performs unexpectedly, Yunnan Jianzhijia 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 Yunnan Jianzhijia will offset losses from the drop in Yunnan Jianzhijia's long position.| Loongson Technology vs. Hubeiyichang Transportation Group | Loongson Technology vs. Western Superconducting Tech | Loongson Technology vs. CGN Nuclear Technology | Loongson Technology vs. HMTNew Technical |
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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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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