Correlation Between Jiahe Foods and Jiangsu Pacific
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By analyzing existing cross correlation between Jiahe Foods Industry and Jiangsu Pacific Quartz, you can compare the effects of market volatilities on Jiahe Foods and Jiangsu Pacific 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 Jiahe Foods with a short position of Jiangsu Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiahe Foods and Jiangsu Pacific.
Diversification Opportunities for Jiahe Foods and Jiangsu Pacific
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiahe and Jiangsu is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Jiahe Foods Industry and Jiangsu Pacific Quartz in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Pacific Quartz and Jiahe Foods 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 Jiahe Foods Industry are associated (or correlated) with Jiangsu Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Pacific Quartz has no effect on the direction of Jiahe Foods i.e., Jiahe Foods and Jiangsu Pacific go up and down completely randomly.
Pair Corralation between Jiahe Foods and Jiangsu Pacific
Assuming the 90 days trading horizon Jiahe Foods is expected to generate 1.03 times less return on investment than Jiangsu Pacific. But when comparing it to its historical volatility, Jiahe Foods Industry is 1.03 times less risky than Jiangsu Pacific. It trades about 0.14 of its potential returns per unit of risk. Jiangsu Pacific Quartz is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2,302 in Jiangsu Pacific Quartz on September 6, 2024 and sell it today you would earn a total of 734.00 from holding Jiangsu Pacific Quartz or generate 31.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Jiahe Foods Industry vs. Jiangsu Pacific Quartz
Performance |
Timeline |
Jiahe Foods Industry |
Jiangsu Pacific Quartz |
Jiahe Foods and Jiangsu Pacific Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jiahe Foods and Jiangsu Pacific
The main advantage of trading using opposite Jiahe Foods and Jiangsu Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiahe Foods position performs unexpectedly, Jiangsu Pacific 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 Jiangsu Pacific will offset losses from the drop in Jiangsu Pacific's long position.Jiahe Foods vs. Industrial and Commercial | Jiahe Foods vs. Agricultural Bank of | Jiahe Foods vs. China Construction Bank | Jiahe Foods vs. Bank of China |
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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