Correlation Between Ningbo Kangqiang and Sichuan Yahua
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By analyzing existing cross correlation between Ningbo Kangqiang Electronics and Sichuan Yahua Industrial, you can compare the effects of market volatilities on Ningbo Kangqiang and Sichuan Yahua 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 Ningbo Kangqiang with a short position of Sichuan Yahua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Kangqiang and Sichuan Yahua.
Diversification Opportunities for Ningbo Kangqiang and Sichuan Yahua
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ningbo and Sichuan is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Kangqiang Electronics and Sichuan Yahua Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Yahua Industrial and Ningbo Kangqiang 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 Ningbo Kangqiang Electronics are associated (or correlated) with Sichuan Yahua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Yahua Industrial has no effect on the direction of Ningbo Kangqiang i.e., Ningbo Kangqiang and Sichuan Yahua go up and down completely randomly.
Pair Corralation between Ningbo Kangqiang and Sichuan Yahua
Assuming the 90 days trading horizon Ningbo Kangqiang is expected to generate 1.93 times less return on investment than Sichuan Yahua. In addition to that, Ningbo Kangqiang is 1.65 times more volatile than Sichuan Yahua Industrial. It trades about 0.1 of its total potential returns per unit of risk. Sichuan Yahua Industrial is currently generating about 0.32 per unit of volatility. If you would invest 1,135 in Sichuan Yahua Industrial on November 5, 2024 and sell it today you would earn a total of 181.00 from holding Sichuan Yahua Industrial or generate 15.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Kangqiang Electronics vs. Sichuan Yahua Industrial
Performance |
| Timeline |
| Ningbo Kangqiang Ele |
| Sichuan Yahua Industrial |
Ningbo Kangqiang and Sichuan Yahua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Kangqiang and Sichuan Yahua
The main advantage of trading using opposite Ningbo Kangqiang and Sichuan Yahua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Kangqiang position performs unexpectedly, Sichuan Yahua 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 Sichuan Yahua will offset losses from the drop in Sichuan Yahua's long position.| Ningbo Kangqiang vs. Nanjing Putian Telecommunications | Ningbo Kangqiang vs. Cloud Live Technology | Ningbo Kangqiang vs. Shenzhen Coship Electronics | Ningbo Kangqiang vs. Shenzhen Hifuture Electric |
| Sichuan Yahua vs. Goodwill E Health | Sichuan Yahua vs. Huatian Hotel Group | Sichuan Yahua vs. Jiangsu Financial Leasing | Sichuan Yahua vs. Xiamen Bank 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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