Correlation Between China Minmetals and Ningbo Construction
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By analyzing existing cross correlation between China Minmetals Rare and Ningbo Construction Co, you can compare the effects of market volatilities on China Minmetals and Ningbo Construction 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 China Minmetals with a short position of Ningbo Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Minmetals and Ningbo Construction.
Diversification Opportunities for China Minmetals and Ningbo Construction
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between China and Ningbo is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding China Minmetals Rare and Ningbo Construction Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Construction and China Minmetals 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 China Minmetals Rare are associated (or correlated) with Ningbo Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Construction has no effect on the direction of China Minmetals i.e., China Minmetals and Ningbo Construction go up and down completely randomly.
Pair Corralation between China Minmetals and Ningbo Construction
Assuming the 90 days trading horizon China Minmetals Rare is expected to generate 0.99 times more return on investment than Ningbo Construction. However, China Minmetals Rare is 1.01 times less risky than Ningbo Construction. It trades about 0.02 of its potential returns per unit of risk. Ningbo Construction Co is currently generating about 0.0 per unit of risk. If you would invest 2,840 in China Minmetals Rare on October 16, 2024 and sell it today you would earn a total of 123.00 from holding China Minmetals Rare or generate 4.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Minmetals Rare vs. Ningbo Construction Co
Performance |
| Timeline |
| China Minmetals Rare |
| Ningbo Construction |
China Minmetals and Ningbo Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Minmetals and Ningbo Construction
The main advantage of trading using opposite China Minmetals and Ningbo Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Minmetals position performs unexpectedly, Ningbo Construction 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 Construction will offset losses from the drop in Ningbo Construction's long position.| China Minmetals vs. Chengdu B ray Media | China Minmetals vs. Suzhou Weizhixiang Food | China Minmetals vs. Sichuan Teway Food | China Minmetals vs. Juewei Food 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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