Correlation Between Guangdong Jingyi and Ningbo Fujia
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By analyzing existing cross correlation between Guangdong Jingyi Metal and Ningbo Fujia Industrial, you can compare the effects of market volatilities on Guangdong Jingyi and Ningbo Fujia 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 Guangdong Jingyi with a short position of Ningbo Fujia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Jingyi and Ningbo Fujia.
Diversification Opportunities for Guangdong Jingyi and Ningbo Fujia
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangdong and Ningbo is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Jingyi Metal and Ningbo Fujia Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Fujia Industrial and Guangdong Jingyi 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 Guangdong Jingyi Metal are associated (or correlated) with Ningbo Fujia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Fujia Industrial has no effect on the direction of Guangdong Jingyi i.e., Guangdong Jingyi and Ningbo Fujia go up and down completely randomly.
Pair Corralation between Guangdong Jingyi and Ningbo Fujia
Assuming the 90 days trading horizon Guangdong Jingyi Metal is expected to under-perform the Ningbo Fujia. But the stock apears to be less risky and, when comparing its historical volatility, Guangdong Jingyi Metal is 1.14 times less risky than Ningbo Fujia. The stock trades about -0.04 of its potential returns per unit of risk. The Ningbo Fujia Industrial is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,372 in Ningbo Fujia Industrial on October 12, 2024 and sell it today you would earn a total of 76.00 from holding Ningbo Fujia Industrial or generate 5.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Jingyi Metal vs. Ningbo Fujia Industrial
Performance |
| Timeline |
| Guangdong Jingyi Metal |
| Ningbo Fujia Industrial |
Guangdong Jingyi and Ningbo Fujia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Jingyi and Ningbo Fujia
The main advantage of trading using opposite Guangdong Jingyi and Ningbo Fujia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Jingyi position performs unexpectedly, Ningbo Fujia 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 Ningbo Fujia will offset losses from the drop in Ningbo Fujia's long position.| Guangdong Jingyi vs. Heren Health Co | Guangdong Jingyi vs. Jiugui Liquor Co | Guangdong Jingyi vs. Hangzhou Minsheng Healthcare | Guangdong Jingyi vs. Shandong Sinoglory Health |
| Ningbo Fujia vs. Hubeiyichang Transportation Group | Ningbo Fujia vs. Fujian Longzhou Transportation | Ningbo Fujia vs. China Minmetals Rare | Ningbo Fujia vs. Hengli Industrial Development |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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