Correlation Between Ningbo Ligong and Guangdong Liantai
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By analyzing existing cross correlation between Ningbo Ligong Online and Guangdong Liantai Environmental, you can compare the effects of market volatilities on Ningbo Ligong and Guangdong Liantai 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 Liantai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Ligong and Guangdong Liantai.
Diversification Opportunities for Ningbo Ligong and Guangdong Liantai
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ningbo and Guangdong is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Ligong Online and Guangdong Liantai Environmenta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Liantai 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 Liantai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Liantai has no effect on the direction of Ningbo Ligong i.e., Ningbo Ligong and Guangdong Liantai go up and down completely randomly.
Pair Corralation between Ningbo Ligong and Guangdong Liantai
Assuming the 90 days trading horizon Ningbo Ligong Online is expected to under-perform the Guangdong Liantai. But the stock apears to be less risky and, when comparing its historical volatility, Ningbo Ligong Online is 1.3 times less risky than Guangdong Liantai. The stock trades about -0.05 of its potential returns per unit of risk. The Guangdong Liantai Environmental is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 391.00 in Guangdong Liantai Environmental on September 5, 2024 and sell it today you would earn a total of 48.00 from holding Guangdong Liantai Environmental or generate 12.28% 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. Guangdong Liantai Environmenta
Performance |
| Timeline |
| Ningbo Ligong Online |
| Guangdong Liantai |
Ningbo Ligong and Guangdong Liantai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Ligong and Guangdong Liantai
The main advantage of trading using opposite Ningbo Ligong and Guangdong Liantai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Ligong position performs unexpectedly, Guangdong Liantai 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 Liantai will offset losses from the drop in Guangdong Liantai's long position.| Ningbo Ligong vs. Zhejiang Kingland Pipeline | Ningbo Ligong vs. China Sports Industry | Ningbo Ligong vs. Guangzhou Jointas Chemical | Ningbo Ligong vs. Miracll Chemicals Co |
| Guangdong Liantai vs. Anji Foodstuff Co | Guangdong Liantai vs. Ningbo Ligong Online | Guangdong Liantai vs. Hunan Mendale Hometextile | Guangdong Liantai vs. Fiberhome Telecommunication Technologies |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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