Correlation Between Jinhua Capital and Postmedia Network
Can any of the company-specific risk be diversified away by investing in both Jinhua Capital and Postmedia Network 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 Jinhua Capital and Postmedia Network into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jinhua Capital and Postmedia Network Canada, you can compare the effects of market volatilities on Jinhua Capital and Postmedia Network 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 Jinhua Capital with a short position of Postmedia Network. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinhua Capital and Postmedia Network.
Diversification Opportunities for Jinhua Capital and Postmedia Network
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jinhua and Postmedia is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Jinhua Capital and Postmedia Network Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postmedia Network Canada and Jinhua Capital 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 Jinhua Capital are associated (or correlated) with Postmedia Network. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postmedia Network Canada has no effect on the direction of Jinhua Capital i.e., Jinhua Capital and Postmedia Network go up and down completely randomly.
Pair Corralation between Jinhua Capital and Postmedia Network
Assuming the 90 days horizon Jinhua Capital is expected to generate 28.1 times more return on investment than Postmedia Network. However, Jinhua Capital is 28.1 times more volatile than Postmedia Network Canada. It trades about 0.14 of its potential returns per unit of risk. Postmedia Network Canada is currently generating about -0.29 per unit of risk. If you would invest 1.00 in Jinhua Capital on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Jinhua Capital or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinhua Capital vs. Postmedia Network Canada
Performance |
| Timeline |
| Jinhua Capital |
| Postmedia Network Canada |
Jinhua Capital and Postmedia Network Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinhua Capital and Postmedia Network
The main advantage of trading using opposite Jinhua Capital and Postmedia Network positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinhua Capital position performs unexpectedly, Postmedia Network 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 Postmedia Network will offset losses from the drop in Postmedia Network's long position.| Jinhua Capital vs. American Hotel Income | Jinhua Capital vs. Champion Iron | Jinhua Capital vs. Falcon Energy Materials | Jinhua Capital vs. Algonquin Power Utilities |
| Postmedia Network vs. Genesis Land Development | Postmedia Network vs. ADF Group | Postmedia Network vs. Madison Pacific Properties | Postmedia Network vs. Goodfellow |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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