Correlation Between Nanxing Furniture and Luyin Investment
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By analyzing existing cross correlation between Nanxing Furniture Machinery and Luyin Investment Group, you can compare the effects of market volatilities on Nanxing Furniture and Luyin Investment 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 Luyin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanxing Furniture and Luyin Investment.
Diversification Opportunities for Nanxing Furniture and Luyin Investment
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nanxing and Luyin is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Nanxing Furniture Machinery and Luyin Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luyin Investment 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 Luyin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luyin Investment has no effect on the direction of Nanxing Furniture i.e., Nanxing Furniture and Luyin Investment go up and down completely randomly.
Pair Corralation between Nanxing Furniture and Luyin Investment
Assuming the 90 days trading horizon Nanxing Furniture Machinery is expected to generate 1.94 times more return on investment than Luyin Investment. However, Nanxing Furniture is 1.94 times more volatile than Luyin Investment Group. It trades about -0.2 of its potential returns per unit of risk. Luyin Investment Group is currently generating about -0.44 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. Luyin Investment Group
Performance |
| Timeline |
| Nanxing Furniture |
| Luyin Investment |
Nanxing Furniture and Luyin Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanxing Furniture and Luyin Investment
The main advantage of trading using opposite Nanxing Furniture and Luyin Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanxing Furniture position performs unexpectedly, Luyin Investment 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 Luyin Investment will offset losses from the drop in Luyin Investment'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 |
| Luyin Investment vs. Nanxing Furniture Machinery | Luyin Investment vs. Shaanxi Construction Machinery | Luyin Investment vs. Hainan Airlines Co | Luyin Investment vs. Zhejiang Construction Investment |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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