Correlation Between Financial Street and NBTM New
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By analyzing existing cross correlation between Financial Street Holdings and NBTM New Materials, you can compare the effects of market volatilities on Financial Street and NBTM New 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 Financial Street with a short position of NBTM New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Financial Street and NBTM New.
Diversification Opportunities for Financial Street and NBTM New
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Financial and NBTM is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Financial Street Holdings and NBTM New Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NBTM New Materials and Financial Street 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 Financial Street Holdings are associated (or correlated) with NBTM New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NBTM New Materials has no effect on the direction of Financial Street i.e., Financial Street and NBTM New go up and down completely randomly.
Pair Corralation between Financial Street and NBTM New
Assuming the 90 days trading horizon Financial Street Holdings is expected to under-perform the NBTM New. But the stock apears to be less risky and, when comparing its historical volatility, Financial Street Holdings is 1.24 times less risky than NBTM New. The stock trades about -0.03 of its potential returns per unit of risk. The NBTM New Materials is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 963.00 in NBTM New Materials on October 18, 2024 and sell it today you would earn a total of 694.00 from holding NBTM New Materials or generate 72.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Financial Street Holdings vs. NBTM New Materials
Performance |
| Timeline |
| Financial Street Holdings |
| NBTM New Materials |
Financial Street and NBTM New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Financial Street and NBTM New
The main advantage of trading using opposite Financial Street and NBTM New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Financial Street position performs unexpectedly, NBTM New 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 NBTM New will offset losses from the drop in NBTM New's long position.| Financial Street vs. Shenzhen Zhongzhuang Construction | Financial Street vs. Hongrun Construction Group | Financial Street vs. Liaoning Chengda Biotechnology | Financial Street vs. Jinhe Biotechnology Co |
| NBTM New vs. Peoples Insurance of | NBTM New vs. Shenwu Energy Saving | NBTM New vs. Financial Street Holdings | NBTM New vs. Qilu Bank 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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