Correlation Between Northking Information and Bingshan Refrigeration
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By analyzing existing cross correlation between Northking Information Technology and Bingshan Refrigeration and, you can compare the effects of market volatilities on Northking Information and Bingshan Refrigeration 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 Northking Information with a short position of Bingshan Refrigeration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northking Information and Bingshan Refrigeration.
Diversification Opportunities for Northking Information and Bingshan Refrigeration
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Northking and Bingshan is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Northking Information Technolo and Bingshan Refrigeration and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bingshan Refrigeration and Northking Information 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 Northking Information Technology are associated (or correlated) with Bingshan Refrigeration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bingshan Refrigeration has no effect on the direction of Northking Information i.e., Northking Information and Bingshan Refrigeration go up and down completely randomly.
Pair Corralation between Northking Information and Bingshan Refrigeration
Assuming the 90 days trading horizon Northking Information Technology is expected to generate 2.03 times more return on investment than Bingshan Refrigeration. However, Northking Information is 2.03 times more volatile than Bingshan Refrigeration and. It trades about 0.01 of its potential returns per unit of risk. Bingshan Refrigeration and is currently generating about 0.01 per unit of risk. If you would invest 1,413 in Northking Information Technology on October 9, 2024 and sell it today you would lose (97.00) from holding Northking Information Technology or give up 6.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Northking Information Technolo vs. Bingshan Refrigeration and
Performance |
| Timeline |
| Northking Information |
| Bingshan Refrigeration |
Northking Information and Bingshan Refrigeration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northking Information and Bingshan Refrigeration
The main advantage of trading using opposite Northking Information and Bingshan Refrigeration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northking Information position performs unexpectedly, Bingshan Refrigeration 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 Bingshan Refrigeration will offset losses from the drop in Bingshan Refrigeration's long position.The idea behind Northking Information Technology and Bingshan Refrigeration and pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Stocks Directory module to find actively traded stocks across global markets.
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