Correlation Between Jiangxi JDL and Shanghai Jinfeng
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By analyzing existing cross correlation between Jiangxi JDL Environmental and Shanghai Jinfeng Wine, you can compare the effects of market volatilities on Jiangxi JDL and Shanghai Jinfeng 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 Jiangxi JDL with a short position of Shanghai Jinfeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangxi JDL and Shanghai Jinfeng.
Diversification Opportunities for Jiangxi JDL and Shanghai Jinfeng
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiangxi and Shanghai is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Jiangxi JDL Environmental and Shanghai Jinfeng Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Jinfeng Wine and Jiangxi JDL 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 Jiangxi JDL Environmental are associated (or correlated) with Shanghai Jinfeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Jinfeng Wine has no effect on the direction of Jiangxi JDL i.e., Jiangxi JDL and Shanghai Jinfeng go up and down completely randomly.
Pair Corralation between Jiangxi JDL and Shanghai Jinfeng
Assuming the 90 days trading horizon Jiangxi JDL is expected to generate 10.39 times less return on investment than Shanghai Jinfeng. But when comparing it to its historical volatility, Jiangxi JDL Environmental is 2.02 times less risky than Shanghai Jinfeng. It trades about 0.05 of its potential returns per unit of risk. Shanghai Jinfeng Wine is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 554.00 in Shanghai Jinfeng Wine on September 13, 2024 and sell it today you would earn a total of 107.00 from holding Shanghai Jinfeng Wine or generate 19.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Jiangxi JDL Environmental vs. Shanghai Jinfeng Wine
Performance |
| Timeline |
| Jiangxi JDL Environmental |
| Shanghai Jinfeng Wine |
Jiangxi JDL and Shanghai Jinfeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangxi JDL and Shanghai Jinfeng
The main advantage of trading using opposite Jiangxi JDL and Shanghai Jinfeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangxi JDL position performs unexpectedly, Shanghai Jinfeng 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 Shanghai Jinfeng will offset losses from the drop in Shanghai Jinfeng's long position.| Jiangxi JDL vs. Lutian Machinery Co | Jiangxi JDL vs. China Longyuan Power | Jiangxi JDL vs. PetroChina Co Ltd | Jiangxi JDL vs. Bank of China |
| Shanghai Jinfeng vs. China Life Insurance | Shanghai Jinfeng vs. Cinda Securities Co | Shanghai Jinfeng vs. Piotech Inc A | Shanghai Jinfeng vs. Dongxing Sec Co |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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