Correlation Between Jiangsu GDK and Luyin Investment
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By analyzing existing cross correlation between Jiangsu GDK Biotechnology and Luyin Investment Group, you can compare the effects of market volatilities on Jiangsu GDK and Luyin Investment 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 Luyin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu GDK and Luyin Investment.
Diversification Opportunities for Jiangsu GDK and Luyin Investment
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiangsu and Luyin is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu GDK Biotechnology and Luyin Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luyin Investment 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 Luyin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luyin Investment has no effect on the direction of Jiangsu GDK i.e., Jiangsu GDK and Luyin Investment go up and down completely randomly.
Pair Corralation between Jiangsu GDK and Luyin Investment
Assuming the 90 days trading horizon Jiangsu GDK Biotechnology is expected to under-perform the Luyin Investment. But the stock apears to be less risky and, when comparing its historical volatility, Jiangsu GDK Biotechnology is 1.09 times less risky than Luyin Investment. The stock trades about -0.06 of its potential returns per unit of risk. The Luyin Investment Group is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 595.00 in Luyin Investment Group on November 3, 2024 and sell it today you would lose (9.00) from holding Luyin Investment Group or give up 1.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu GDK Biotechnology vs. Luyin Investment Group
Performance |
| Timeline |
| Jiangsu GDK Biotechnology |
| Luyin Investment |
Jiangsu GDK and Luyin Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu GDK and Luyin Investment
The main advantage of trading using opposite Jiangsu GDK and Luyin Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu GDK position performs unexpectedly, Luyin Investment 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 Luyin Investment will offset losses from the drop in Luyin Investment's long position.| Jiangsu GDK vs. PetroChina Co Ltd | Jiangsu GDK vs. China Railway Construction | Jiangsu GDK vs. China Mobile Limited | Jiangsu GDK vs. Industrial and Commercial |
| Luyin Investment vs. Zijin Mining Group | Luyin Investment vs. Wanhua Chemical Group | Luyin Investment vs. Baoshan Iron Steel | Luyin Investment vs. Shandong Gold Mining |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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