Correlation Between Hongrun Construction and NARI Technology
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By analyzing existing cross correlation between Hongrun Construction Group and NARI Technology Co, you can compare the effects of market volatilities on Hongrun Construction and NARI Technology 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 Hongrun Construction with a short position of NARI Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hongrun Construction and NARI Technology.
Diversification Opportunities for Hongrun Construction and NARI Technology
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hongrun and NARI is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Hongrun Construction Group and NARI Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NARI Technology and Hongrun Construction 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 Hongrun Construction Group are associated (or correlated) with NARI Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NARI Technology has no effect on the direction of Hongrun Construction i.e., Hongrun Construction and NARI Technology go up and down completely randomly.
Pair Corralation between Hongrun Construction and NARI Technology
Assuming the 90 days trading horizon Hongrun Construction Group is expected to generate 2.03 times more return on investment than NARI Technology. However, Hongrun Construction is 2.03 times more volatile than NARI Technology Co. It trades about 0.21 of its potential returns per unit of risk. NARI Technology Co is currently generating about -0.21 per unit of risk. If you would invest 408.00 in Hongrun Construction Group on September 2, 2024 and sell it today you would earn a total of 57.00 from holding Hongrun Construction Group or generate 13.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hongrun Construction Group vs. NARI Technology Co
Performance |
| Timeline |
| Hongrun Construction |
| NARI Technology |
Hongrun Construction and NARI Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hongrun Construction and NARI Technology
The main advantage of trading using opposite Hongrun Construction and NARI Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hongrun Construction position performs unexpectedly, NARI Technology 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 NARI Technology will offset losses from the drop in NARI Technology's long position.| Hongrun Construction vs. 159681 | Hongrun Construction vs. 159005 | Hongrun Construction vs. Loctek Ergonomic Technology | Hongrun Construction vs. 516220 |
| NARI Technology vs. Weichai Heavy Machinery | NARI Technology vs. Hunan Tyen Machinery | NARI Technology vs. Cicc Fund Management | NARI Technology vs. Hongrun Construction Group |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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