Correlation Between Ningbo Ligong and Xiamen Bank
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By analyzing existing cross correlation between Ningbo Ligong Online and Xiamen Bank Co, you can compare the effects of market volatilities on Ningbo Ligong and Xiamen Bank 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 Xiamen Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Ligong and Xiamen Bank.
Diversification Opportunities for Ningbo Ligong and Xiamen Bank
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ningbo and Xiamen is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Ligong Online and Xiamen Bank Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Bank 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 Xiamen Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Bank has no effect on the direction of Ningbo Ligong i.e., Ningbo Ligong and Xiamen Bank go up and down completely randomly.
Pair Corralation between Ningbo Ligong and Xiamen Bank
Assuming the 90 days trading horizon Ningbo Ligong Online is expected to generate 1.86 times more return on investment than Xiamen Bank. However, Ningbo Ligong is 1.86 times more volatile than Xiamen Bank Co. It trades about 0.03 of its potential returns per unit of risk. Xiamen Bank Co is currently generating about -0.19 per unit of risk. If you would invest 1,282 in Ningbo Ligong Online on October 29, 2024 and sell it today you would earn a total of 9.00 from holding Ningbo Ligong Online or generate 0.7% 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. Xiamen Bank Co
Performance |
| Timeline |
| Ningbo Ligong Online |
| Xiamen Bank |
Ningbo Ligong and Xiamen Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Ligong and Xiamen Bank
The main advantage of trading using opposite Ningbo Ligong and Xiamen Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Ligong position performs unexpectedly, Xiamen Bank 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 Xiamen Bank will offset losses from the drop in Xiamen Bank's long position.| Ningbo Ligong vs. Ningbo Kangqiang Electronics | Ningbo Ligong vs. Namchow Food Group | Ningbo Ligong vs. Guilin Seamild Foods | Ningbo Ligong vs. Xinjiang Tianrun Dairy |
| Xiamen Bank vs. Hunan TV Broadcast | Xiamen Bank vs. Tianshan Aluminum Group | Xiamen Bank vs. Longjian Road Bridge | Xiamen Bank vs. Hubeiyichang Transportation Group |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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