Correlation Between Ningbo Kangqiang and Soochow Suzhou
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By analyzing existing cross correlation between Ningbo Kangqiang Electronics and Soochow Suzhou Industrial, you can compare the effects of market volatilities on Ningbo Kangqiang and Soochow Suzhou 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 Soochow Suzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Kangqiang and Soochow Suzhou.
Diversification Opportunities for Ningbo Kangqiang and Soochow Suzhou
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ningbo and Soochow is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Kangqiang Electronics and Soochow Suzhou Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soochow Suzhou 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 Soochow Suzhou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soochow Suzhou Industrial has no effect on the direction of Ningbo Kangqiang i.e., Ningbo Kangqiang and Soochow Suzhou go up and down completely randomly.
Pair Corralation between Ningbo Kangqiang and Soochow Suzhou
Assuming the 90 days trading horizon Ningbo Kangqiang Electronics is expected to generate 6.24 times more return on investment than Soochow Suzhou. However, Ningbo Kangqiang is 6.24 times more volatile than Soochow Suzhou Industrial. It trades about 0.1 of its potential returns per unit of risk. Soochow Suzhou Industrial is currently generating about 0.54 per unit of risk. If you would invest 1,609 in Ningbo Kangqiang Electronics on November 5, 2024 and sell it today you would earn a total of 104.00 from holding Ningbo Kangqiang Electronics or generate 6.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Kangqiang Electronics vs. Soochow Suzhou Industrial
Performance |
| Timeline |
| Ningbo Kangqiang Ele |
| Soochow Suzhou Industrial |
Ningbo Kangqiang and Soochow Suzhou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Kangqiang and Soochow Suzhou
The main advantage of trading using opposite Ningbo Kangqiang and Soochow Suzhou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Kangqiang position performs unexpectedly, Soochow Suzhou 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 Soochow Suzhou will offset losses from the drop in Soochow Suzhou'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 |
| Soochow Suzhou vs. Sanbo Hospital Management | Soochow Suzhou vs. Dawning Information Industry | Soochow Suzhou vs. Wonders Information | Soochow Suzhou vs. Shanghai CEO Environmental |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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