Correlation Between Ningbo Ligong and Guangdong Xiongsu
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By analyzing existing cross correlation between Ningbo Ligong Online and Guangdong Xiongsu Technology, you can compare the effects of market volatilities on Ningbo Ligong and Guangdong Xiongsu 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 Guangdong Xiongsu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Ligong and Guangdong Xiongsu.
Diversification Opportunities for Ningbo Ligong and Guangdong Xiongsu
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ningbo and Guangdong is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Ligong Online and Guangdong Xiongsu Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Xiongsu 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 Guangdong Xiongsu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Xiongsu has no effect on the direction of Ningbo Ligong i.e., Ningbo Ligong and Guangdong Xiongsu go up and down completely randomly.
Pair Corralation between Ningbo Ligong and Guangdong Xiongsu
Assuming the 90 days trading horizon Ningbo Ligong Online is expected to generate 0.72 times more return on investment than Guangdong Xiongsu. However, Ningbo Ligong Online is 1.39 times less risky than Guangdong Xiongsu. It trades about 0.03 of its potential returns per unit of risk. Guangdong Xiongsu Technology is currently generating about 0.01 per unit of risk. If you would invest 1,012 in Ningbo Ligong Online on November 6, 2024 and sell it today you would earn a total of 289.00 from holding Ningbo Ligong Online or generate 28.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Ligong Online vs. Guangdong Xiongsu Technology
Performance |
| Timeline |
| Ningbo Ligong Online |
| Guangdong Xiongsu |
Ningbo Ligong and Guangdong Xiongsu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Ligong and Guangdong Xiongsu
The main advantage of trading using opposite Ningbo Ligong and Guangdong Xiongsu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Ligong position performs unexpectedly, Guangdong Xiongsu 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 Guangdong Xiongsu will offset losses from the drop in Guangdong Xiongsu's long position.| Ningbo Ligong vs. Hefei Metalforming Mach | Ningbo Ligong vs. Guocheng Mining Co | Ningbo Ligong vs. Chengtun Mining Group | Ningbo Ligong vs. Ping An Insurance |
| Guangdong Xiongsu vs. Guocheng Mining Co | Guangdong Xiongsu vs. Guangdong Silvere Sci | Guangdong Xiongsu vs. Tibet Huayu Mining | Guangdong Xiongsu vs. China Everbright Bank |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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