Correlation Between Northking Information and Tsingtao Brewery
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By analyzing existing cross correlation between Northking Information Technology and Tsingtao Brewery Co, you can compare the effects of market volatilities on Northking Information and Tsingtao Brewery 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 Tsingtao Brewery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northking Information and Tsingtao Brewery.
Diversification Opportunities for Northking Information and Tsingtao Brewery
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Northking and Tsingtao is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Northking Information Technolo and Tsingtao Brewery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tsingtao Brewery 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 Tsingtao Brewery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tsingtao Brewery has no effect on the direction of Northking Information i.e., Northking Information and Tsingtao Brewery go up and down completely randomly.
Pair Corralation between Northking Information and Tsingtao Brewery
Assuming the 90 days trading horizon Northking Information Technology is expected to generate 1.47 times more return on investment than Tsingtao Brewery. However, Northking Information is 1.47 times more volatile than Tsingtao Brewery Co. It trades about 0.04 of its potential returns per unit of risk. Tsingtao Brewery Co is currently generating about 0.0 per unit of risk. If you would invest 1,170 in Northking Information Technology on November 9, 2024 and sell it today you would earn a total of 310.00 from holding Northking Information Technology or generate 26.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Northking Information Technolo vs. Tsingtao Brewery Co
Performance |
| Timeline |
| Northking Information |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Tsingtao Brewery |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Northking Information and Tsingtao Brewery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northking Information and Tsingtao Brewery
The main advantage of trading using opposite Northking Information and Tsingtao Brewery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northking Information position performs unexpectedly, Tsingtao Brewery 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 Tsingtao Brewery will offset losses from the drop in Tsingtao Brewery's long position.The idea behind Northking Information Technology and Tsingtao Brewery Co 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.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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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