Correlation Between Ningbo Tech and Hongrun Construction
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By analyzing existing cross correlation between Ningbo Tech Bank Co and Hongrun Construction Group, you can compare the effects of market volatilities on Ningbo Tech and Hongrun Construction 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 Tech with a short position of Hongrun Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Tech and Hongrun Construction.
Diversification Opportunities for Ningbo Tech and Hongrun Construction
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ningbo and Hongrun is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Tech Bank Co and Hongrun Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hongrun Construction and Ningbo Tech 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 Tech Bank Co are associated (or correlated) with Hongrun Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hongrun Construction has no effect on the direction of Ningbo Tech i.e., Ningbo Tech and Hongrun Construction go up and down completely randomly.
Pair Corralation between Ningbo Tech and Hongrun Construction
Assuming the 90 days trading horizon Ningbo Tech Bank Co is expected to generate 1.13 times more return on investment than Hongrun Construction. However, Ningbo Tech is 1.13 times more volatile than Hongrun Construction Group. It trades about 0.16 of its potential returns per unit of risk. Hongrun Construction Group is currently generating about 0.0 per unit of risk. If you would invest 284.00 in Ningbo Tech Bank Co on October 29, 2024 and sell it today you would earn a total of 20.00 from holding Ningbo Tech Bank Co or generate 7.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Tech Bank Co vs. Hongrun Construction Group
Performance |
| Timeline |
| Ningbo Tech Bank |
| Hongrun Construction |
Ningbo Tech and Hongrun Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Tech and Hongrun Construction
The main advantage of trading using opposite Ningbo Tech and Hongrun Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Tech position performs unexpectedly, Hongrun Construction 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 Hongrun Construction will offset losses from the drop in Hongrun Construction's long position.| Ningbo Tech vs. Yindu Kitchen Equipment | Ningbo Tech vs. Sichuan Hebang Biotechnology | Ningbo Tech vs. Fiberhome Telecommunication Technologies | Ningbo Tech vs. Beijing Kingsoft Office |
| Hongrun Construction vs. Industrial and Commercial | Hongrun Construction vs. China Construction Bank | Hongrun Construction vs. Agricultural Bank of | Hongrun Construction vs. Bank of China |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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