Correlation Between Guangzhou Haige and Ningxia Building
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By analyzing existing cross correlation between Guangzhou Haige Communications and Ningxia Building Materials, you can compare the effects of market volatilities on Guangzhou Haige and Ningxia Building 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 Guangzhou Haige with a short position of Ningxia Building. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Haige and Ningxia Building.
Diversification Opportunities for Guangzhou Haige and Ningxia Building
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangzhou and Ningxia is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Haige Communications and Ningxia Building Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningxia Building Mat and Guangzhou Haige 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 Guangzhou Haige Communications are associated (or correlated) with Ningxia Building. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningxia Building Mat has no effect on the direction of Guangzhou Haige i.e., Guangzhou Haige and Ningxia Building go up and down completely randomly.
Pair Corralation between Guangzhou Haige and Ningxia Building
Assuming the 90 days trading horizon Guangzhou Haige Communications is expected to under-perform the Ningxia Building. But the stock apears to be less risky and, when comparing its historical volatility, Guangzhou Haige Communications is 1.59 times less risky than Ningxia Building. The stock trades about -0.48 of its potential returns per unit of risk. The Ningxia Building Materials is currently generating about -0.18 of returns per unit of risk over similar time horizon. If you would invest 1,462 in Ningxia Building Materials on October 14, 2024 and sell it today you would lose (172.00) from holding Ningxia Building Materials or give up 11.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Haige Communications vs. Ningxia Building Materials
Performance |
| Timeline |
| Guangzhou Haige Comm |
| Ningxia Building Mat |
Guangzhou Haige and Ningxia Building Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Haige and Ningxia Building
The main advantage of trading using opposite Guangzhou Haige and Ningxia Building positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Haige position performs unexpectedly, Ningxia Building 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 Ningxia Building will offset losses from the drop in Ningxia Building's long position.| Guangzhou Haige vs. Uroica Mining Safety | Guangzhou Haige vs. ButOne Information Corp | Guangzhou Haige vs. Zhengzhou Coal Mining | Guangzhou Haige vs. Longmaster Information Tech |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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