Correlation Between Zhejiang JIULI and Jiangxi Naipu
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By analyzing existing cross correlation between Zhejiang JIULI Hi tech and Jiangxi Naipu Mining, you can compare the effects of market volatilities on Zhejiang JIULI and Jiangxi Naipu 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 Zhejiang JIULI with a short position of Jiangxi Naipu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang JIULI and Jiangxi Naipu.
Diversification Opportunities for Zhejiang JIULI and Jiangxi Naipu
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhejiang and Jiangxi is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang JIULI Hi tech and Jiangxi Naipu Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi Naipu Mining and Zhejiang JIULI 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 Zhejiang JIULI Hi tech are associated (or correlated) with Jiangxi Naipu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi Naipu Mining has no effect on the direction of Zhejiang JIULI i.e., Zhejiang JIULI and Jiangxi Naipu go up and down completely randomly.
Pair Corralation between Zhejiang JIULI and Jiangxi Naipu
Assuming the 90 days trading horizon Zhejiang JIULI is expected to generate 3.61 times less return on investment than Jiangxi Naipu. But when comparing it to its historical volatility, Zhejiang JIULI Hi tech is 1.36 times less risky than Jiangxi Naipu. It trades about 0.02 of its potential returns per unit of risk. Jiangxi Naipu Mining is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,444 in Jiangxi Naipu Mining on September 25, 2024 and sell it today you would earn a total of 456.00 from holding Jiangxi Naipu Mining or generate 18.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Zhejiang JIULI Hi tech vs. Jiangxi Naipu Mining
Performance |
Timeline |
Zhejiang JIULI Hi |
Jiangxi Naipu Mining |
Zhejiang JIULI and Jiangxi Naipu Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zhejiang JIULI and Jiangxi Naipu
The main advantage of trading using opposite Zhejiang JIULI and Jiangxi Naipu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang JIULI position performs unexpectedly, Jiangxi Naipu 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 Jiangxi Naipu will offset losses from the drop in Jiangxi Naipu's long position.Zhejiang JIULI vs. Wanhua Chemical Group | Zhejiang JIULI vs. Shandong Gold Mining | Zhejiang JIULI vs. Rongsheng Petrochemical Co | Zhejiang JIULI vs. Inner Mongolia BaoTou |
Jiangxi Naipu vs. Industrial and Commercial | Jiangxi Naipu vs. Agricultural Bank of | Jiangxi Naipu vs. China Construction Bank | Jiangxi Naipu vs. Bank of China |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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