Correlation Between JIAHUA STORES and Rheinmetall
Can any of the company-specific risk be diversified away by investing in both JIAHUA STORES and Rheinmetall at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining JIAHUA STORES and Rheinmetall into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JIAHUA STORES and Rheinmetall AG, you can compare the effects of market volatilities on JIAHUA STORES and Rheinmetall 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 JIAHUA STORES with a short position of Rheinmetall. Check out your portfolio center. Please also check ongoing floating volatility patterns of JIAHUA STORES and Rheinmetall.
Diversification Opportunities for JIAHUA STORES and Rheinmetall
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JIAHUA and Rheinmetall is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding JIAHUA STORES and Rheinmetall AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rheinmetall AG and JIAHUA STORES 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 JIAHUA STORES are associated (or correlated) with Rheinmetall. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rheinmetall AG has no effect on the direction of JIAHUA STORES i.e., JIAHUA STORES and Rheinmetall go up and down completely randomly.
Pair Corralation between JIAHUA STORES and Rheinmetall
If you would invest 50,000 in Rheinmetall AG on November 6, 2024 and sell it today you would earn a total of 25,360 from holding Rheinmetall AG or generate 50.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.33% |
| Values | Daily Returns |
JIAHUA STORES vs. Rheinmetall AG
Performance |
| Timeline |
| JIAHUA STORES |
| Rheinmetall AG |
JIAHUA STORES and Rheinmetall Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JIAHUA STORES and Rheinmetall
The main advantage of trading using opposite JIAHUA STORES and Rheinmetall positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JIAHUA STORES position performs unexpectedly, Rheinmetall 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 Rheinmetall will offset losses from the drop in Rheinmetall's long position.| JIAHUA STORES vs. Constellation Software | JIAHUA STORES vs. JAPAN AIRLINES | JIAHUA STORES vs. MAGIC SOFTWARE ENTR | JIAHUA STORES vs. FORMPIPE SOFTWARE AB |
| Rheinmetall vs. International Consolidated Airlines | Rheinmetall vs. SINGAPORE AIRLINES | Rheinmetall vs. Singapore Airlines Limited | Rheinmetall vs. OPERA SOFTWARE |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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