Correlation Between Ningbo Ligong and Anhui Tongguan
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By analyzing existing cross correlation between Ningbo Ligong Online and Anhui Tongguan Copper, you can compare the effects of market volatilities on Ningbo Ligong and Anhui Tongguan 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 Anhui Tongguan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Ligong and Anhui Tongguan.
Diversification Opportunities for Ningbo Ligong and Anhui Tongguan
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ningbo and Anhui is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Ligong Online and Anhui Tongguan Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Tongguan Copper 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 Anhui Tongguan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Tongguan Copper has no effect on the direction of Ningbo Ligong i.e., Ningbo Ligong and Anhui Tongguan go up and down completely randomly.
Pair Corralation between Ningbo Ligong and Anhui Tongguan
Assuming the 90 days trading horizon Ningbo Ligong Online is expected to under-perform the Anhui Tongguan. But the stock apears to be less risky and, when comparing its historical volatility, Ningbo Ligong Online is 2.55 times less risky than Anhui Tongguan. The stock trades about -0.44 of its potential returns per unit of risk. The Anhui Tongguan Copper is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 1,111 in Anhui Tongguan Copper on October 11, 2024 and sell it today you would lose (45.00) from holding Anhui Tongguan Copper or give up 4.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Ligong Online vs. Anhui Tongguan Copper
Performance |
| Timeline |
| Ningbo Ligong Online |
| Anhui Tongguan Copper |
Ningbo Ligong and Anhui Tongguan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Ligong and Anhui Tongguan
The main advantage of trading using opposite Ningbo Ligong and Anhui Tongguan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Ligong position performs unexpectedly, Anhui Tongguan 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 Anhui Tongguan will offset losses from the drop in Anhui Tongguan's long position.| Ningbo Ligong vs. Advanced Technology Materials | Ningbo Ligong vs. Jilin OLED Material | Ningbo Ligong vs. Tongyu Communication | Ningbo Ligong vs. Jiangxi Hengda Hi Tech |
| Anhui Tongguan vs. Ningbo Ligong Online | Anhui Tongguan vs. Integrated Electronic Systems | Anhui Tongguan vs. Beijing YanDong MicroElectronic | Anhui Tongguan vs. Guangzhou Jinyi Media |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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