Correlation Between Liaoning Chengda and JuneYao Dairy
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By analyzing existing cross correlation between Liaoning Chengda Biotechnology and JuneYao Dairy Co, you can compare the effects of market volatilities on Liaoning Chengda and JuneYao Dairy 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 Liaoning Chengda with a short position of JuneYao Dairy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liaoning Chengda and JuneYao Dairy.
Diversification Opportunities for Liaoning Chengda and JuneYao Dairy
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Liaoning and JuneYao is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Liaoning Chengda Biotechnology and JuneYao Dairy Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JuneYao Dairy and Liaoning Chengda 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 Liaoning Chengda Biotechnology are associated (or correlated) with JuneYao Dairy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JuneYao Dairy has no effect on the direction of Liaoning Chengda i.e., Liaoning Chengda and JuneYao Dairy go up and down completely randomly.
Pair Corralation between Liaoning Chengda and JuneYao Dairy
Assuming the 90 days trading horizon Liaoning Chengda Biotechnology is expected to generate 0.32 times more return on investment than JuneYao Dairy. However, Liaoning Chengda Biotechnology is 3.14 times less risky than JuneYao Dairy. It trades about -0.1 of its potential returns per unit of risk. JuneYao Dairy Co is currently generating about -0.08 per unit of risk. If you would invest 2,732 in Liaoning Chengda Biotechnology on October 30, 2024 and sell it today you would lose (142.00) from holding Liaoning Chengda Biotechnology or give up 5.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liaoning Chengda Biotechnology vs. JuneYao Dairy Co
Performance |
| Timeline |
| Liaoning Chengda Bio |
| JuneYao Dairy |
Liaoning Chengda and JuneYao Dairy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liaoning Chengda and JuneYao Dairy
The main advantage of trading using opposite Liaoning Chengda and JuneYao Dairy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liaoning Chengda position performs unexpectedly, JuneYao Dairy 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 JuneYao Dairy will offset losses from the drop in JuneYao Dairy's long position.| Liaoning Chengda vs. China Petroleum Chemical | Liaoning Chengda vs. PetroChina Co Ltd | Liaoning Chengda vs. China State Construction | Liaoning Chengda vs. China Railway Group |
| JuneYao Dairy vs. Hunan Mendale Hometextile | JuneYao Dairy vs. DO Home Collection | JuneYao Dairy vs. Shanghai CEO Environmental | JuneYao Dairy vs. UE Furniture 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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