Correlation Between Nanxing Furniture and Zhende Medical
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By analyzing existing cross correlation between Nanxing Furniture Machinery and Zhende Medical Co, you can compare the effects of market volatilities on Nanxing Furniture and Zhende Medical 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 Zhende Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanxing Furniture and Zhende Medical.
Diversification Opportunities for Nanxing Furniture and Zhende Medical
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nanxing and Zhende is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Nanxing Furniture Machinery and Zhende Medical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhende Medical 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 Zhende Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhende Medical has no effect on the direction of Nanxing Furniture i.e., Nanxing Furniture and Zhende Medical go up and down completely randomly.
Pair Corralation between Nanxing Furniture and Zhende Medical
Assuming the 90 days trading horizon Nanxing Furniture Machinery is expected to generate 3.99 times more return on investment than Zhende Medical. However, Nanxing Furniture is 3.99 times more volatile than Zhende Medical Co. It trades about 0.12 of its potential returns per unit of risk. Zhende Medical Co is currently generating about -0.08 per unit of risk. If you would invest 1,410 in Nanxing Furniture Machinery on August 28, 2024 and sell it today you would earn a total of 175.00 from holding Nanxing Furniture Machinery or generate 12.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Nanxing Furniture Machinery vs. Zhende Medical Co
Performance |
| Timeline |
| Nanxing Furniture |
| Zhende Medical |
Nanxing Furniture and Zhende Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanxing Furniture and Zhende Medical
The main advantage of trading using opposite Nanxing Furniture and Zhende Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanxing Furniture position performs unexpectedly, Zhende Medical 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 Zhende Medical will offset losses from the drop in Zhende Medical's long position.| Nanxing Furniture vs. Dhc Software Co | Nanxing Furniture vs. Vanfund Urban Investment | Nanxing Furniture vs. China National Software | Nanxing Furniture vs. Chengdu Xingrong Investment |
| Zhende Medical vs. Bank of China | Zhende Medical vs. Kweichow Moutai Co | Zhende Medical vs. PetroChina Co Ltd | Zhende Medical vs. Bank of Communications |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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