Correlation Between Nanhua Bio and Qingdao Hi
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By analyzing existing cross correlation between Nanhua Bio Medicine and Qingdao Hi Tech Moulds, you can compare the effects of market volatilities on Nanhua Bio and Qingdao Hi 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 Nanhua Bio with a short position of Qingdao Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanhua Bio and Qingdao Hi.
Diversification Opportunities for Nanhua Bio and Qingdao Hi
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Nanhua and Qingdao is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Nanhua Bio Medicine and Qingdao Hi Tech Moulds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingdao Hi Tech and Nanhua Bio 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 Nanhua Bio Medicine are associated (or correlated) with Qingdao Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingdao Hi Tech has no effect on the direction of Nanhua Bio i.e., Nanhua Bio and Qingdao Hi go up and down completely randomly.
Pair Corralation between Nanhua Bio and Qingdao Hi
Assuming the 90 days trading horizon Nanhua Bio Medicine is expected to generate 0.83 times more return on investment than Qingdao Hi. However, Nanhua Bio Medicine is 1.2 times less risky than Qingdao Hi. It trades about 0.02 of its potential returns per unit of risk. Qingdao Hi Tech Moulds is currently generating about 0.01 per unit of risk. If you would invest 1,078 in Nanhua Bio Medicine on September 12, 2024 and sell it today you would lose (28.00) from holding Nanhua Bio Medicine or give up 2.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanhua Bio Medicine vs. Qingdao Hi Tech Moulds
Performance |
| Timeline |
| Nanhua Bio Medicine |
| Qingdao Hi Tech |
Nanhua Bio and Qingdao Hi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanhua Bio and Qingdao Hi
The main advantage of trading using opposite Nanhua Bio and Qingdao Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanhua Bio position performs unexpectedly, Qingdao Hi 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 Qingdao Hi will offset losses from the drop in Qingdao Hi's long position.| Nanhua Bio vs. Kweichow Moutai Co | Nanhua Bio vs. Shenzhen Mindray Bio Medical | Nanhua Bio vs. G bits Network Technology | Nanhua Bio vs. Beijing Roborock Technology |
| Qingdao Hi vs. Agricultural Bank of | Qingdao Hi vs. Industrial and Commercial | Qingdao Hi vs. Bank of China | Qingdao Hi vs. PetroChina Co Ltd |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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