Correlation Between Shaanxi Meineng and Ningbo Jianan
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By analyzing existing cross correlation between Shaanxi Meineng Clean and Ningbo Jianan Electronics, you can compare the effects of market volatilities on Shaanxi Meineng and Ningbo Jianan 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 Shaanxi Meineng with a short position of Ningbo Jianan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaanxi Meineng and Ningbo Jianan.
Diversification Opportunities for Shaanxi Meineng and Ningbo Jianan
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shaanxi and Ningbo is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Shaanxi Meineng Clean and Ningbo Jianan Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Jianan Electronics and Shaanxi Meineng 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 Shaanxi Meineng Clean are associated (or correlated) with Ningbo Jianan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Jianan Electronics has no effect on the direction of Shaanxi Meineng i.e., Shaanxi Meineng and Ningbo Jianan go up and down completely randomly.
Pair Corralation between Shaanxi Meineng and Ningbo Jianan
Assuming the 90 days trading horizon Shaanxi Meineng Clean is expected to under-perform the Ningbo Jianan. But the stock apears to be less risky and, when comparing its historical volatility, Shaanxi Meineng Clean is 1.38 times less risky than Ningbo Jianan. The stock trades about 0.0 of its potential returns per unit of risk. The Ningbo Jianan Electronics is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,648 in Ningbo Jianan Electronics on November 28, 2024 and sell it today you would earn a total of 654.00 from holding Ningbo Jianan Electronics or generate 39.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shaanxi Meineng Clean vs. Ningbo Jianan Electronics
Performance |
| Timeline |
| Shaanxi Meineng Clean |
| Ningbo Jianan Electronics |
Shaanxi Meineng and Ningbo Jianan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shaanxi Meineng and Ningbo Jianan
The main advantage of trading using opposite Shaanxi Meineng and Ningbo Jianan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaanxi Meineng position performs unexpectedly, Ningbo Jianan 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 Jianan will offset losses from the drop in Ningbo Jianan's long position.| Shaanxi Meineng vs. Shandong Publishing Media | Shaanxi Meineng vs. Dezhan HealthCare Co | Shaanxi Meineng vs. Chinese Universe Publishing | Shaanxi Meineng vs. Shanghai Action Education |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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