Correlation Between De Rucci and Nanxing Furniture
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By analyzing existing cross correlation between De Rucci Healthy and Nanxing Furniture Machinery, you can compare the effects of market volatilities on De Rucci and Nanxing Furniture 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 De Rucci with a short position of Nanxing Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of De Rucci and Nanxing Furniture.
Diversification Opportunities for De Rucci and Nanxing Furniture
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 001323 and Nanxing is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding De Rucci Healthy and Nanxing Furniture Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanxing Furniture and De Rucci 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 De Rucci Healthy are associated (or correlated) with Nanxing Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanxing Furniture has no effect on the direction of De Rucci i.e., De Rucci and Nanxing Furniture go up and down completely randomly.
Pair Corralation between De Rucci and Nanxing Furniture
Assuming the 90 days trading horizon De Rucci is expected to generate 2.68 times less return on investment than Nanxing Furniture. But when comparing it to its historical volatility, De Rucci Healthy is 1.42 times less risky than Nanxing Furniture. It trades about 0.02 of its potential returns per unit of risk. Nanxing Furniture Machinery is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,075 in Nanxing Furniture Machinery on August 24, 2024 and sell it today you would earn a total of 635.00 from holding Nanxing Furniture Machinery or generate 59.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
De Rucci Healthy vs. Nanxing Furniture Machinery
Performance |
| Timeline |
| De Rucci Healthy |
| Nanxing Furniture |
De Rucci and Nanxing Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with De Rucci and Nanxing Furniture
The main advantage of trading using opposite De Rucci and Nanxing Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if De Rucci position performs unexpectedly, Nanxing Furniture 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 Nanxing Furniture will offset losses from the drop in Nanxing Furniture's long position.| De Rucci vs. Kweichow Moutai Co | De Rucci vs. Contemporary Amperex Technology | De Rucci vs. G bits Network Technology | De Rucci vs. Beijing Roborock Technology |
| Nanxing Furniture vs. Chengdu Kanghua Biological | Nanxing Furniture vs. Beijing Wantai Biological | Nanxing Furniture vs. Suzhou Novoprotein Scientific | Nanxing Furniture vs. Aluminum Corp of |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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