Correlation Between Yuanjie Semiconductor and Jiangsu Financial
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By analyzing existing cross correlation between Yuanjie Semiconductor Technology and Jiangsu Financial Leasing, you can compare the effects of market volatilities on Yuanjie Semiconductor and Jiangsu Financial 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 Yuanjie Semiconductor with a short position of Jiangsu Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuanjie Semiconductor and Jiangsu Financial.
Diversification Opportunities for Yuanjie Semiconductor and Jiangsu Financial
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Yuanjie and Jiangsu is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Yuanjie Semiconductor Technolo and Jiangsu Financial Leasing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Financial Leasing and Yuanjie Semiconductor 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 Yuanjie Semiconductor Technology are associated (or correlated) with Jiangsu Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Financial Leasing has no effect on the direction of Yuanjie Semiconductor i.e., Yuanjie Semiconductor and Jiangsu Financial go up and down completely randomly.
Pair Corralation between Yuanjie Semiconductor and Jiangsu Financial
Assuming the 90 days trading horizon Yuanjie Semiconductor Technology is expected to under-perform the Jiangsu Financial. In addition to that, Yuanjie Semiconductor is 3.83 times more volatile than Jiangsu Financial Leasing. It trades about -0.06 of its total potential returns per unit of risk. Jiangsu Financial Leasing is currently generating about -0.06 per unit of volatility. If you would invest 522.00 in Jiangsu Financial Leasing on September 13, 2024 and sell it today you would lose (8.00) from holding Jiangsu Financial Leasing or give up 1.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yuanjie Semiconductor Technolo vs. Jiangsu Financial Leasing
Performance |
| Timeline |
| Yuanjie Semiconductor |
| Jiangsu Financial Leasing |
Yuanjie Semiconductor and Jiangsu Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuanjie Semiconductor and Jiangsu Financial
The main advantage of trading using opposite Yuanjie Semiconductor and Jiangsu Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuanjie Semiconductor position performs unexpectedly, Jiangsu Financial 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 Jiangsu Financial will offset losses from the drop in Jiangsu Financial's long position.The idea behind Yuanjie Semiconductor Technology and Jiangsu Financial Leasing pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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