Correlation Between Zhejiang Kingland and Ningbo Ligong
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By analyzing existing cross correlation between Zhejiang Kingland Pipeline and Ningbo Ligong Online, you can compare the effects of market volatilities on Zhejiang Kingland and Ningbo Ligong 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 Zhejiang Kingland with a short position of Ningbo Ligong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Kingland and Ningbo Ligong.
Diversification Opportunities for Zhejiang Kingland and Ningbo Ligong
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhejiang and Ningbo is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Kingland Pipeline and Ningbo Ligong Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Ligong Online and Zhejiang Kingland 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 Zhejiang Kingland Pipeline are associated (or correlated) with Ningbo Ligong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Ligong Online has no effect on the direction of Zhejiang Kingland i.e., Zhejiang Kingland and Ningbo Ligong go up and down completely randomly.
Pair Corralation between Zhejiang Kingland and Ningbo Ligong
Assuming the 90 days trading horizon Zhejiang Kingland Pipeline is expected to under-perform the Ningbo Ligong. But the stock apears to be less risky and, when comparing its historical volatility, Zhejiang Kingland Pipeline is 2.64 times less risky than Ningbo Ligong. The stock trades about -0.04 of its potential returns per unit of risk. The Ningbo Ligong Online is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,259 in Ningbo Ligong Online on November 1, 2024 and sell it today you would earn a total of 42.00 from holding Ningbo Ligong Online or generate 3.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Kingland Pipeline vs. Ningbo Ligong Online
Performance |
| Timeline |
| Zhejiang Kingland |
| Ningbo Ligong Online |
Zhejiang Kingland and Ningbo Ligong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Kingland and Ningbo Ligong
The main advantage of trading using opposite Zhejiang Kingland and Ningbo Ligong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Kingland position performs unexpectedly, Ningbo Ligong 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 Ningbo Ligong will offset losses from the drop in Ningbo Ligong's long position.| Zhejiang Kingland vs. Queclink Wireless Solutions | Zhejiang Kingland vs. Quectel Wireless Solutions | Zhejiang Kingland vs. Glodon Software Co | Zhejiang Kingland vs. Double Medical Technology |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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