Correlation Between Nanxing Furniture and Offshore Oil
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By analyzing existing cross correlation between Nanxing Furniture Machinery and Offshore Oil Engineering, you can compare the effects of market volatilities on Nanxing Furniture and Offshore Oil 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 Offshore Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanxing Furniture and Offshore Oil.
Diversification Opportunities for Nanxing Furniture and Offshore Oil
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nanxing and Offshore is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Nanxing Furniture Machinery and Offshore Oil Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Offshore Oil Engineering 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 Offshore Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Offshore Oil Engineering has no effect on the direction of Nanxing Furniture i.e., Nanxing Furniture and Offshore Oil go up and down completely randomly.
Pair Corralation between Nanxing Furniture and Offshore Oil
Assuming the 90 days trading horizon Nanxing Furniture Machinery is expected to generate 3.67 times more return on investment than Offshore Oil. However, Nanxing Furniture is 3.67 times more volatile than Offshore Oil Engineering. It trades about 0.18 of its potential returns per unit of risk. Offshore Oil Engineering is currently generating about 0.04 per unit of risk. If you would invest 1,500 in Nanxing Furniture Machinery on November 3, 2024 and sell it today you would earn a total of 249.00 from holding Nanxing Furniture Machinery or generate 16.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanxing Furniture Machinery vs. Offshore Oil Engineering
Performance |
| Timeline |
| Nanxing Furniture |
| Offshore Oil Engineering |
Nanxing Furniture and Offshore Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanxing Furniture and Offshore Oil
The main advantage of trading using opposite Nanxing Furniture and Offshore Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanxing Furniture position performs unexpectedly, Offshore Oil 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 Offshore Oil will offset losses from the drop in Offshore Oil's long position.| Nanxing Furniture vs. Aba Chemicals Corp | Nanxing Furniture vs. Shandong Polymer Biochemicals | Nanxing Furniture vs. APT Medical | Nanxing Furniture vs. Guangdong Transtek Medical |
| Offshore Oil vs. Shenzhen Cotran New | Offshore Oil vs. Juneyao Airlines | Offshore Oil vs. Suzhou Douson Drilling | Offshore Oil vs. Konfoong Materials International |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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