Correlation Between Alphabet and Jinling Hotel
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By analyzing existing cross correlation between Alphabet Inc Class C and Jinling Hotel Corp, you can compare the effects of market volatilities on Alphabet and Jinling Hotel 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 Alphabet with a short position of Jinling Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphabet and Jinling Hotel.
Diversification Opportunities for Alphabet and Jinling Hotel
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Alphabet and Jinling is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Alphabet Inc Class C and Jinling Hotel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinling Hotel Corp and Alphabet 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 Alphabet Inc Class C are associated (or correlated) with Jinling Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinling Hotel Corp has no effect on the direction of Alphabet i.e., Alphabet and Jinling Hotel go up and down completely randomly.
Pair Corralation between Alphabet and Jinling Hotel
Given the investment horizon of 90 days Alphabet is expected to generate 1.01 times less return on investment than Jinling Hotel. In addition to that, Alphabet is 1.03 times more volatile than Jinling Hotel Corp. It trades about 0.04 of its total potential returns per unit of risk. Jinling Hotel Corp is currently generating about 0.04 per unit of volatility. If you would invest 666.00 in Jinling Hotel Corp on August 25, 2024 and sell it today you would earn a total of 9.00 from holding Jinling Hotel Corp or generate 1.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Alphabet Inc Class C vs. Jinling Hotel Corp
Performance |
| Timeline |
| Alphabet Class C |
| Jinling Hotel Corp |
Alphabet and Jinling Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alphabet and Jinling Hotel
The main advantage of trading using opposite Alphabet and Jinling Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alphabet position performs unexpectedly, Jinling Hotel 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 Jinling Hotel will offset losses from the drop in Jinling Hotel's long position.The idea behind Alphabet Inc Class C and Jinling Hotel Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Jinling Hotel vs. Ningbo Fangzheng Automobile | Jinling Hotel vs. Road Environment Technology | Jinling Hotel vs. Glodon Software Co | Jinling Hotel vs. Linewell Software 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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