Correlation Between Xiangyang Automobile and Ningbo MedicalSystem
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By analyzing existing cross correlation between Xiangyang Automobile Bearing and Ningbo MedicalSystem Biotechnology, you can compare the effects of market volatilities on Xiangyang Automobile and Ningbo MedicalSystem 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 Xiangyang Automobile with a short position of Ningbo MedicalSystem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangyang Automobile and Ningbo MedicalSystem.
Diversification Opportunities for Xiangyang Automobile and Ningbo MedicalSystem
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Xiangyang and Ningbo is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Xiangyang Automobile Bearing and Ningbo MedicalSystem Biotechno in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo MedicalSystem and Xiangyang Automobile 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 Xiangyang Automobile Bearing are associated (or correlated) with Ningbo MedicalSystem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo MedicalSystem has no effect on the direction of Xiangyang Automobile i.e., Xiangyang Automobile and Ningbo MedicalSystem go up and down completely randomly.
Pair Corralation between Xiangyang Automobile and Ningbo MedicalSystem
Assuming the 90 days trading horizon Xiangyang Automobile Bearing is expected to under-perform the Ningbo MedicalSystem. In addition to that, Xiangyang Automobile is 2.92 times more volatile than Ningbo MedicalSystem Biotechnology. It trades about -0.23 of its total potential returns per unit of risk. Ningbo MedicalSystem Biotechnology is currently generating about -0.41 per unit of volatility. If you would invest 1,163 in Ningbo MedicalSystem Biotechnology on October 11, 2024 and sell it today you would lose (165.00) from holding Ningbo MedicalSystem Biotechnology or give up 14.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangyang Automobile Bearing vs. Ningbo MedicalSystem Biotechno
Performance |
| Timeline |
| Xiangyang Automobile |
| Ningbo MedicalSystem |
Xiangyang Automobile and Ningbo MedicalSystem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangyang Automobile and Ningbo MedicalSystem
The main advantage of trading using opposite Xiangyang Automobile and Ningbo MedicalSystem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangyang Automobile position performs unexpectedly, Ningbo MedicalSystem 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 Ningbo MedicalSystem will offset losses from the drop in Ningbo MedicalSystem's long position.| Xiangyang Automobile vs. Ming Yang Smart | Xiangyang Automobile vs. 159681 | Xiangyang Automobile vs. 159005 | Xiangyang Automobile vs. Loctek Ergonomic Technology |
| Ningbo MedicalSystem vs. Beijing Kingsoft Office | Ningbo MedicalSystem vs. Bank of Communications | Ningbo MedicalSystem vs. King Strong New Material | Ningbo MedicalSystem vs. Quectel Wireless Solutions |
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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