Correlation Between Jiangsu GDK and Shandong Sinoglory
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By analyzing existing cross correlation between Jiangsu GDK Biotechnology and Shandong Sinoglory Health, you can compare the effects of market volatilities on Jiangsu GDK and Shandong Sinoglory 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 Shandong Sinoglory. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu GDK and Shandong Sinoglory.
Diversification Opportunities for Jiangsu GDK and Shandong Sinoglory
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jiangsu and Shandong is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu GDK Biotechnology and Shandong Sinoglory Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Sinoglory Health 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 Shandong Sinoglory. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Sinoglory Health has no effect on the direction of Jiangsu GDK i.e., Jiangsu GDK and Shandong Sinoglory go up and down completely randomly.
Pair Corralation between Jiangsu GDK and Shandong Sinoglory
Assuming the 90 days trading horizon Jiangsu GDK Biotechnology is expected to under-perform the Shandong Sinoglory. In addition to that, Jiangsu GDK is 1.49 times more volatile than Shandong Sinoglory Health. It trades about -0.05 of its total potential returns per unit of risk. Shandong Sinoglory Health is currently generating about 0.0 per unit of volatility. If you would invest 1,410 in Shandong Sinoglory Health on September 12, 2024 and sell it today you would lose (80.00) from holding Shandong Sinoglory Health or give up 5.67% 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. Shandong Sinoglory Health
Performance |
| Timeline |
| Jiangsu GDK Biotechnology |
| Shandong Sinoglory Health |
Jiangsu GDK and Shandong Sinoglory Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu GDK and Shandong Sinoglory
The main advantage of trading using opposite Jiangsu GDK and Shandong Sinoglory positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu GDK position performs unexpectedly, Shandong Sinoglory 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 Shandong Sinoglory will offset losses from the drop in Shandong Sinoglory's long position.| Jiangsu GDK vs. Yunnan Xiyi Industrial | Jiangsu GDK vs. Sichuan Fulin Transportation | Jiangsu GDK vs. Anhui Transport Consulting | Jiangsu GDK vs. Lonkey Industrial Co |
| Shandong Sinoglory vs. China Petroleum Chemical | Shandong Sinoglory vs. PetroChina Co Ltd | Shandong Sinoglory vs. China State Construction | Shandong Sinoglory vs. China Railway Group |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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