Correlation Between Ningbo Ligong and Sanxiang Advanced
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By analyzing existing cross correlation between Ningbo Ligong Online and Sanxiang Advanced Materials, you can compare the effects of market volatilities on Ningbo Ligong and Sanxiang Advanced 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 Sanxiang Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Ligong and Sanxiang Advanced.
Diversification Opportunities for Ningbo Ligong and Sanxiang Advanced
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ningbo and Sanxiang is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Ligong Online and Sanxiang Advanced Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanxiang Advanced 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 Sanxiang Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanxiang Advanced has no effect on the direction of Ningbo Ligong i.e., Ningbo Ligong and Sanxiang Advanced go up and down completely randomly.
Pair Corralation between Ningbo Ligong and Sanxiang Advanced
Assuming the 90 days trading horizon Ningbo Ligong is expected to generate 3.61 times less return on investment than Sanxiang Advanced. But when comparing it to its historical volatility, Ningbo Ligong Online is 1.57 times less risky than Sanxiang Advanced. It trades about 0.03 of its potential returns per unit of risk. Sanxiang Advanced Materials is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 939.00 in Sanxiang Advanced Materials on September 1, 2024 and sell it today you would earn a total of 774.00 from holding Sanxiang Advanced Materials or generate 82.43% 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. Sanxiang Advanced Materials
Performance |
| Timeline |
| Ningbo Ligong Online |
| Sanxiang Advanced |
Ningbo Ligong and Sanxiang Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Ligong and Sanxiang Advanced
The main advantage of trading using opposite Ningbo Ligong and Sanxiang Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Ligong position performs unexpectedly, Sanxiang Advanced 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 Sanxiang Advanced will offset losses from the drop in Sanxiang Advanced's long position.| Ningbo Ligong vs. Ping An Insurance | Ningbo Ligong vs. Jiangsu Financial Leasing | Ningbo Ligong vs. Servyou Software Group | Ningbo Ligong vs. Qilu Bank Co |
| Sanxiang Advanced vs. Ligao Foods CoLtd | Sanxiang Advanced vs. Great Sun Foods Co | Sanxiang Advanced vs. Anji Foodstuff Co | Sanxiang Advanced vs. Hengdian Entertainment Co |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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