Correlation Between Ningbo Ligong and Hunan Mendale
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By analyzing existing cross correlation between Ningbo Ligong Online and Hunan Mendale Hometextile, you can compare the effects of market volatilities on Ningbo Ligong and Hunan Mendale 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 Hunan Mendale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Ligong and Hunan Mendale.
Diversification Opportunities for Ningbo Ligong and Hunan Mendale
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ningbo and Hunan is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Ligong Online and Hunan Mendale Hometextile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hunan Mendale Hometextile 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 Hunan Mendale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hunan Mendale Hometextile has no effect on the direction of Ningbo Ligong i.e., Ningbo Ligong and Hunan Mendale go up and down completely randomly.
Pair Corralation between Ningbo Ligong and Hunan Mendale
Assuming the 90 days trading horizon Ningbo Ligong Online is expected to under-perform the Hunan Mendale. But the stock apears to be less risky and, when comparing its historical volatility, Ningbo Ligong Online is 1.67 times less risky than Hunan Mendale. The stock trades about -0.11 of its potential returns per unit of risk. The Hunan Mendale Hometextile is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 279.00 in Hunan Mendale Hometextile on September 14, 2024 and sell it today you would earn a total of 62.00 from holding Hunan Mendale Hometextile or generate 22.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Ligong Online vs. Hunan Mendale Hometextile
Performance |
| Timeline |
| Ningbo Ligong Online |
| Hunan Mendale Hometextile |
Ningbo Ligong and Hunan Mendale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Ligong and Hunan Mendale
The main advantage of trading using opposite Ningbo Ligong and Hunan Mendale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Ligong position performs unexpectedly, Hunan Mendale 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 Hunan Mendale will offset losses from the drop in Hunan Mendale's long position.| Ningbo Ligong vs. China Petroleum Chemical | Ningbo Ligong vs. PetroChina Co Ltd | Ningbo Ligong vs. China State Construction | Ningbo Ligong vs. China Railway Group |
| Hunan Mendale vs. Nanjing Putian Telecommunications | Hunan Mendale vs. Tianjin Realty Development | Hunan Mendale vs. Kangyue Technology Co | Hunan Mendale vs. Shenzhen Hifuture Electric |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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