Correlation Between Ningxia Younglight and Shandong Ruifeng
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By analyzing existing cross correlation between Ningxia Younglight Chemicals and Shandong Ruifeng Chemical, you can compare the effects of market volatilities on Ningxia Younglight and Shandong Ruifeng 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 Ningxia Younglight with a short position of Shandong Ruifeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningxia Younglight and Shandong Ruifeng.
Diversification Opportunities for Ningxia Younglight and Shandong Ruifeng
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Ningxia and Shandong is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Ningxia Younglight Chemicals and Shandong Ruifeng Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Ruifeng Chemical and Ningxia Younglight 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 Ningxia Younglight Chemicals are associated (or correlated) with Shandong Ruifeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Ruifeng Chemical has no effect on the direction of Ningxia Younglight i.e., Ningxia Younglight and Shandong Ruifeng go up and down completely randomly.
Pair Corralation between Ningxia Younglight and Shandong Ruifeng
Assuming the 90 days trading horizon Ningxia Younglight is expected to generate 6.22 times less return on investment than Shandong Ruifeng. But when comparing it to its historical volatility, Ningxia Younglight Chemicals is 1.22 times less risky than Shandong Ruifeng. It trades about 0.01 of its potential returns per unit of risk. Shandong Ruifeng Chemical is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 823.00 in Shandong Ruifeng Chemical on August 29, 2024 and sell it today you would earn a total of 316.00 from holding Shandong Ruifeng Chemical or generate 38.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningxia Younglight Chemicals vs. Shandong Ruifeng Chemical
Performance |
| Timeline |
| Ningxia Younglight |
| Shandong Ruifeng Chemical |
Ningxia Younglight and Shandong Ruifeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningxia Younglight and Shandong Ruifeng
The main advantage of trading using opposite Ningxia Younglight and Shandong Ruifeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningxia Younglight position performs unexpectedly, Shandong Ruifeng 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 Shandong Ruifeng will offset losses from the drop in Shandong Ruifeng's long position.| Ningxia Younglight vs. Zijin Mining Group | Ningxia Younglight vs. Wanhua Chemical Group | Ningxia Younglight vs. Baoshan Iron Steel | Ningxia Younglight vs. Shandong Gold Mining |
| Shandong Ruifeng vs. Bloomage Biotechnology Corp | Shandong Ruifeng vs. Unigroup Guoxin Microelectronics | Shandong Ruifeng vs. Epoxy Base Electronic | Shandong Ruifeng vs. Techshine Electronics 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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