Correlation Between Ningxia Younglight and Jiangsu Xinri
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By analyzing existing cross correlation between Ningxia Younglight Chemicals and Jiangsu Xinri E Vehicle, you can compare the effects of market volatilities on Ningxia Younglight and Jiangsu Xinri 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 Jiangsu Xinri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningxia Younglight and Jiangsu Xinri.
Diversification Opportunities for Ningxia Younglight and Jiangsu Xinri
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ningxia and Jiangsu is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Ningxia Younglight Chemicals and Jiangsu Xinri E Vehicle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Xinri E 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 Jiangsu Xinri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Xinri E has no effect on the direction of Ningxia Younglight i.e., Ningxia Younglight and Jiangsu Xinri go up and down completely randomly.
Pair Corralation between Ningxia Younglight and Jiangsu Xinri
Assuming the 90 days trading horizon Ningxia Younglight Chemicals is expected to under-perform the Jiangsu Xinri. In addition to that, Ningxia Younglight is 1.65 times more volatile than Jiangsu Xinri E Vehicle. It trades about -0.13 of its total potential returns per unit of risk. Jiangsu Xinri E Vehicle is currently generating about 0.18 per unit of volatility. If you would invest 1,048 in Jiangsu Xinri E Vehicle on September 5, 2024 and sell it today you would earn a total of 84.00 from holding Jiangsu Xinri E Vehicle or generate 8.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningxia Younglight Chemicals vs. Jiangsu Xinri E Vehicle
Performance |
| Timeline |
| Ningxia Younglight |
| Jiangsu Xinri E |
Ningxia Younglight and Jiangsu Xinri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningxia Younglight and Jiangsu Xinri
The main advantage of trading using opposite Ningxia Younglight and Jiangsu Xinri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningxia Younglight position performs unexpectedly, Jiangsu Xinri 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 Xinri will offset losses from the drop in Jiangsu Xinri's long position.| Ningxia Younglight vs. Tengda Construction Group | Ningxia Younglight vs. Jiangsu Jinling Sports | Ningxia Younglight vs. Shantui Construction Machinery | Ningxia Younglight vs. Huitong Construction Group |
| Jiangsu Xinri vs. Ningxia Younglight Chemicals | Jiangsu Xinri vs. Ningxia Building Materials | Jiangsu Xinri vs. Xilong Chemical Co | Jiangsu Xinri vs. Jilin Chemical Fibre |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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