Correlation Between Ningbo Ligong and Huatian Hotel
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By analyzing existing cross correlation between Ningbo Ligong Online and Huatian Hotel Group, you can compare the effects of market volatilities on Ningbo Ligong and Huatian Hotel 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 Ligong with a short position of Huatian Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Ligong and Huatian Hotel.
Diversification Opportunities for Ningbo Ligong and Huatian Hotel
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ningbo and Huatian is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Ligong Online and Huatian Hotel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huatian Hotel Group and Ningbo Ligong 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 Ligong Online are associated (or correlated) with Huatian Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huatian Hotel Group has no effect on the direction of Ningbo Ligong i.e., Ningbo Ligong and Huatian Hotel go up and down completely randomly.
Pair Corralation between Ningbo Ligong and Huatian Hotel
Assuming the 90 days trading horizon Ningbo Ligong Online is expected to generate 0.89 times more return on investment than Huatian Hotel. However, Ningbo Ligong Online is 1.13 times less risky than Huatian Hotel. It trades about 0.05 of its potential returns per unit of risk. Huatian Hotel Group is currently generating about -0.03 per unit of risk. If you would invest 858.00 in Ningbo Ligong Online on August 31, 2024 and sell it today you would earn a total of 456.00 from holding Ningbo Ligong Online or generate 53.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Ligong Online vs. Huatian Hotel Group
Performance |
| Timeline |
| Ningbo Ligong Online |
| Huatian Hotel Group |
Ningbo Ligong and Huatian Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Ligong and Huatian Hotel
The main advantage of trading using opposite Ningbo Ligong and Huatian Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Ligong position performs unexpectedly, Huatian Hotel 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 Huatian Hotel will offset losses from the drop in Huatian Hotel's long position.| Ningbo Ligong vs. Qingdao Choho Industrial | Ningbo Ligong vs. Aurora Optoelectronics Co | Ningbo Ligong vs. Xinjiang Baodi Mining | Ningbo Ligong vs. Shandong Mining Machinery |
| Huatian Hotel vs. China State Construction | Huatian Hotel vs. China Merchants Shekou | Huatian Hotel vs. Huafa Industrial Co | Huatian Hotel vs. China International Capital |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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