Correlation Between Jiangsu GDK and Shenzhen Centralcon
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By analyzing existing cross correlation between Jiangsu GDK Biotechnology and Shenzhen Centralcon Investment, you can compare the effects of market volatilities on Jiangsu GDK and Shenzhen Centralcon 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 Jiangsu GDK with a short position of Shenzhen Centralcon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu GDK and Shenzhen Centralcon.
Diversification Opportunities for Jiangsu GDK and Shenzhen Centralcon
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiangsu and Shenzhen is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu GDK Biotechnology and Shenzhen Centralcon Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Centralcon and Jiangsu GDK 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 Jiangsu GDK Biotechnology are associated (or correlated) with Shenzhen Centralcon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Centralcon has no effect on the direction of Jiangsu GDK i.e., Jiangsu GDK and Shenzhen Centralcon go up and down completely randomly.
Pair Corralation between Jiangsu GDK and Shenzhen Centralcon
Assuming the 90 days trading horizon Jiangsu GDK Biotechnology is expected to generate 1.51 times more return on investment than Shenzhen Centralcon. However, Jiangsu GDK is 1.51 times more volatile than Shenzhen Centralcon Investment. It trades about 0.28 of its potential returns per unit of risk. Shenzhen Centralcon Investment is currently generating about 0.06 per unit of risk. If you would invest 1,357 in Jiangsu GDK Biotechnology on September 1, 2024 and sell it today you would earn a total of 311.00 from holding Jiangsu GDK Biotechnology or generate 22.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu GDK Biotechnology vs. Shenzhen Centralcon Investment
Performance |
| Timeline |
| Jiangsu GDK Biotechnology |
| Shenzhen Centralcon |
Jiangsu GDK and Shenzhen Centralcon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu GDK and Shenzhen Centralcon
The main advantage of trading using opposite Jiangsu GDK and Shenzhen Centralcon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu GDK position performs unexpectedly, Shenzhen Centralcon 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 Shenzhen Centralcon will offset losses from the drop in Shenzhen Centralcon's long position.| Jiangsu GDK vs. PetroChina Co Ltd | Jiangsu GDK vs. China Mobile Limited | Jiangsu GDK vs. CNOOC Limited | Jiangsu GDK vs. Ping An Insurance |
| Shenzhen Centralcon vs. Anhui Huilong Agricultural | Shenzhen Centralcon vs. Huitong Construction Group | Shenzhen Centralcon vs. Kuangda Technology Group | Shenzhen Centralcon vs. Allied Machinery 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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