Correlation Between Jinsanjiang Silicon and Sichuan Yahua

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Can any of the company-specific risk be diversified away by investing in both Jinsanjiang Silicon and Sichuan Yahua 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 Jinsanjiang Silicon and Sichuan Yahua into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jinsanjiang Silicon Material and Sichuan Yahua Industrial, you can compare the effects of market volatilities on Jinsanjiang Silicon and Sichuan Yahua 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 Jinsanjiang Silicon with a short position of Sichuan Yahua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinsanjiang Silicon and Sichuan Yahua.

Diversification Opportunities for Jinsanjiang Silicon and Sichuan Yahua

JinsanjiangSichuanDiversified AwayJinsanjiangSichuanDiversified Away100%
-0.02
  Correlation Coefficient

Good diversification

The 3 months correlation between Jinsanjiang and Sichuan is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Jinsanjiang Silicon Material and Sichuan Yahua Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Yahua Industrial and Jinsanjiang Silicon 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 Jinsanjiang Silicon Material are associated (or correlated) with Sichuan Yahua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Yahua Industrial has no effect on the direction of Jinsanjiang Silicon i.e., Jinsanjiang Silicon and Sichuan Yahua go up and down completely randomly.

Pair Corralation between Jinsanjiang Silicon and Sichuan Yahua

Assuming the 90 days trading horizon Jinsanjiang Silicon Material is expected to under-perform the Sichuan Yahua. In addition to that, Jinsanjiang Silicon is 1.33 times more volatile than Sichuan Yahua Industrial. It trades about -0.06 of its total potential returns per unit of risk. Sichuan Yahua Industrial is currently generating about 0.12 per unit of volatility. If you would invest  1,061  in Sichuan Yahua Industrial on October 26, 2024 and sell it today you would earn a total of  231.00  from holding Sichuan Yahua Industrial or generate 21.77% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Jinsanjiang Silicon Material  vs.  Sichuan Yahua Industrial

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 05101520253035
JavaScript chart by amCharts 3.21.15301059 002497
       Timeline  
Jinsanjiang Silicon 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Jinsanjiang Silicon Material has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan9.51010.51111.51212.51313.5
Sichuan Yahua Industrial 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Sichuan Yahua Industrial are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Sichuan Yahua sustained solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan10.51111.51212.51313.514

Jinsanjiang Silicon and Sichuan Yahua Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-14.79-11.08-7.36-3.650.06193.757.5611.3715.19 0.010.020.030.04
JavaScript chart by amCharts 3.21.15301059 002497
       Returns  

Pair Trading with Jinsanjiang Silicon and Sichuan Yahua

The main advantage of trading using opposite Jinsanjiang Silicon and Sichuan Yahua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinsanjiang Silicon position performs unexpectedly, Sichuan Yahua 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 Sichuan Yahua will offset losses from the drop in Sichuan Yahua's long position.
The idea behind Jinsanjiang Silicon Material and Sichuan Yahua Industrial 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.
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.

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