Correlation Between Chengdu Xingrong and NAURA Technology
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By analyzing existing cross correlation between Chengdu Xingrong Investment and NAURA Technology Group, you can compare the effects of market volatilities on Chengdu Xingrong and NAURA Technology 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 Chengdu Xingrong with a short position of NAURA Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Xingrong and NAURA Technology.
Diversification Opportunities for Chengdu Xingrong and NAURA Technology
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Chengdu and NAURA is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Xingrong Investment and NAURA Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NAURA Technology and Chengdu Xingrong 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 Chengdu Xingrong Investment are associated (or correlated) with NAURA Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NAURA Technology has no effect on the direction of Chengdu Xingrong i.e., Chengdu Xingrong and NAURA Technology go up and down completely randomly.
Pair Corralation between Chengdu Xingrong and NAURA Technology
Assuming the 90 days trading horizon Chengdu Xingrong Investment is expected to under-perform the NAURA Technology. But the stock apears to be less risky and, when comparing its historical volatility, Chengdu Xingrong Investment is 1.24 times less risky than NAURA Technology. The stock trades about -0.13 of its potential returns per unit of risk. The NAURA Technology Group is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 40,350 in NAURA Technology Group on October 23, 2024 and sell it today you would lose (1,492) from holding NAURA Technology Group or give up 3.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Xingrong Investment vs. NAURA Technology Group
Performance |
| Timeline |
| Chengdu Xingrong Inv |
| NAURA Technology |
Chengdu Xingrong and NAURA Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Xingrong and NAURA Technology
The main advantage of trading using opposite Chengdu Xingrong and NAURA Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Xingrong position performs unexpectedly, NAURA Technology 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 NAURA Technology will offset losses from the drop in NAURA Technology's long position.| Chengdu Xingrong vs. Zhejiang Construction Investment | Chengdu Xingrong vs. Hubei Geoway Investment | Chengdu Xingrong vs. Kunwu Jiuding Investment | Chengdu Xingrong vs. Jointo Energy Investment |
| NAURA Technology vs. Western Metal Materials | NAURA Technology vs. Orinko Advanced Plastics | NAURA Technology vs. Advanced Technology Materials | NAURA Technology vs. Shandong Hongchuang Aluminum |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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