Correlation Between Nanxing Furniture and XinJiang GuoTong
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By analyzing existing cross correlation between Nanxing Furniture Machinery and XinJiang GuoTong Pipeline, you can compare the effects of market volatilities on Nanxing Furniture and XinJiang GuoTong 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 Nanxing Furniture with a short position of XinJiang GuoTong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanxing Furniture and XinJiang GuoTong.
Diversification Opportunities for Nanxing Furniture and XinJiang GuoTong
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nanxing and XinJiang is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Nanxing Furniture Machinery and XinJiang GuoTong Pipeline in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XinJiang GuoTong Pipeline and Nanxing Furniture 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 Nanxing Furniture Machinery are associated (or correlated) with XinJiang GuoTong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XinJiang GuoTong Pipeline has no effect on the direction of Nanxing Furniture i.e., Nanxing Furniture and XinJiang GuoTong go up and down completely randomly.
Pair Corralation between Nanxing Furniture and XinJiang GuoTong
Assuming the 90 days trading horizon Nanxing Furniture Machinery is expected to generate 0.7 times more return on investment than XinJiang GuoTong. However, Nanxing Furniture Machinery is 1.43 times less risky than XinJiang GuoTong. It trades about -0.2 of its potential returns per unit of risk. XinJiang GuoTong Pipeline is currently generating about -0.24 per unit of risk. If you would invest 1,640 in Nanxing Furniture Machinery on October 14, 2024 and sell it today you would lose (227.00) from holding Nanxing Furniture Machinery or give up 13.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanxing Furniture Machinery vs. XinJiang GuoTong Pipeline
Performance |
| Timeline |
| Nanxing Furniture |
| XinJiang GuoTong Pipeline |
Nanxing Furniture and XinJiang GuoTong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanxing Furniture and XinJiang GuoTong
The main advantage of trading using opposite Nanxing Furniture and XinJiang GuoTong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanxing Furniture position performs unexpectedly, XinJiang GuoTong 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 XinJiang GuoTong will offset losses from the drop in XinJiang GuoTong's long position.| Nanxing Furniture vs. Changjiang Publishing Media | Nanxing Furniture vs. Xinhua Winshare Publishing | Nanxing Furniture vs. Beijing Kaiwen Education | Nanxing Furniture vs. BTG Hotels Group |
| XinJiang GuoTong vs. Nanxing Furniture Machinery | XinJiang GuoTong vs. Digiwin Software Co | XinJiang GuoTong vs. Hunan Tyen Machinery | XinJiang GuoTong vs. Tianjin Ruixin Technology |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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