Correlation Between Jiangsu GDK and Liuzhou Chemical
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By analyzing existing cross correlation between Jiangsu GDK Biotechnology and Liuzhou Chemical Industry, you can compare the effects of market volatilities on Jiangsu GDK and Liuzhou Chemical 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 Liuzhou Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu GDK and Liuzhou Chemical.
Diversification Opportunities for Jiangsu GDK and Liuzhou Chemical
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jiangsu and Liuzhou is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu GDK Biotechnology and Liuzhou Chemical Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liuzhou Chemical Industry 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 Liuzhou Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liuzhou Chemical Industry has no effect on the direction of Jiangsu GDK i.e., Jiangsu GDK and Liuzhou Chemical go up and down completely randomly.
Pair Corralation between Jiangsu GDK and Liuzhou Chemical
Assuming the 90 days trading horizon Jiangsu GDK Biotechnology is expected to under-perform the Liuzhou Chemical. In addition to that, Jiangsu GDK is 1.47 times more volatile than Liuzhou Chemical Industry. It trades about -0.02 of its total potential returns per unit of risk. Liuzhou Chemical Industry is currently generating about 0.0 per unit of volatility. If you would invest 348.00 in Liuzhou Chemical Industry on September 3, 2024 and sell it today you would lose (43.00) from holding Liuzhou Chemical Industry or give up 12.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu GDK Biotechnology vs. Liuzhou Chemical Industry
Performance |
| Timeline |
| Jiangsu GDK Biotechnology |
| Liuzhou Chemical Industry |
Jiangsu GDK and Liuzhou Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu GDK and Liuzhou Chemical
The main advantage of trading using opposite Jiangsu GDK and Liuzhou Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu GDK position performs unexpectedly, Liuzhou Chemical 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 Liuzhou Chemical will offset losses from the drop in Liuzhou Chemical's long position.| Jiangsu GDK vs. Chengdu Kanghua Biological | Jiangsu GDK vs. Beijing Wantai Biological | Jiangsu GDK vs. Suzhou Novoprotein Scientific | Jiangsu GDK vs. Aluminum Corp of |
| Liuzhou Chemical vs. Ye Chiu Metal | Liuzhou Chemical vs. Xinjiang Baodi Mining | Liuzhou Chemical vs. Anhui Transport Consulting | Liuzhou Chemical vs. Hengli Industrial Development |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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