Correlation Between Jiangsu GDK and Changjiang Jinggong
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By analyzing existing cross correlation between Jiangsu GDK Biotechnology and Changjiang Jinggong Steel, you can compare the effects of market volatilities on Jiangsu GDK and Changjiang Jinggong 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 Changjiang Jinggong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu GDK and Changjiang Jinggong.
Diversification Opportunities for Jiangsu GDK and Changjiang Jinggong
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiangsu and Changjiang is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu GDK Biotechnology and Changjiang Jinggong Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changjiang Jinggong Steel 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 Changjiang Jinggong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changjiang Jinggong Steel has no effect on the direction of Jiangsu GDK i.e., Jiangsu GDK and Changjiang Jinggong go up and down completely randomly.
Pair Corralation between Jiangsu GDK and Changjiang Jinggong
Assuming the 90 days trading horizon Jiangsu GDK Biotechnology is expected to under-perform the Changjiang Jinggong. In addition to that, Jiangsu GDK is 2.37 times more volatile than Changjiang Jinggong Steel. It trades about -0.02 of its total potential returns per unit of risk. Changjiang Jinggong Steel is currently generating about -0.03 per unit of volatility. If you would invest 401.00 in Changjiang Jinggong Steel on September 3, 2024 and sell it today you would lose (90.00) from holding Changjiang Jinggong Steel or give up 22.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu GDK Biotechnology vs. Changjiang Jinggong Steel
Performance |
| Timeline |
| Jiangsu GDK Biotechnology |
| Changjiang Jinggong Steel |
Jiangsu GDK and Changjiang Jinggong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu GDK and Changjiang Jinggong
The main advantage of trading using opposite Jiangsu GDK and Changjiang Jinggong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu GDK position performs unexpectedly, Changjiang Jinggong 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 Changjiang Jinggong will offset losses from the drop in Changjiang Jinggong'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 |
| Changjiang Jinggong vs. China Life Insurance | Changjiang Jinggong vs. HaiXin Foods Co | Changjiang Jinggong vs. Ping An Insurance | Changjiang Jinggong vs. China Publishing Media |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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