Correlation Between NH Investment and Golden Bridge
Can any of the company-specific risk be diversified away by investing in both NH Investment and Golden Bridge at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining NH Investment and Golden Bridge into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NH Investment Securities and Golden Bridge Investment, you can compare the effects of market volatilities on NH Investment and Golden Bridge 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 NH Investment with a short position of Golden Bridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of NH Investment and Golden Bridge.
Diversification Opportunities for NH Investment and Golden Bridge
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 005940 and Golden is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding NH Investment Securities and Golden Bridge Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Bridge Investment and NH Investment 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 NH Investment Securities are associated (or correlated) with Golden Bridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Bridge Investment has no effect on the direction of NH Investment i.e., NH Investment and Golden Bridge go up and down completely randomly.
Pair Corralation between NH Investment and Golden Bridge
Assuming the 90 days trading horizon NH Investment Securities is expected to generate 0.74 times more return on investment than Golden Bridge. However, NH Investment Securities is 1.36 times less risky than Golden Bridge. It trades about 0.08 of its potential returns per unit of risk. Golden Bridge Investment is currently generating about -0.06 per unit of risk. If you would invest 819,074 in NH Investment Securities on August 28, 2024 and sell it today you would earn a total of 518,926 from holding NH Investment Securities or generate 63.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NH Investment Securities vs. Golden Bridge Investment
Performance |
| Timeline |
| NH Investment Securities |
| Golden Bridge Investment |
NH Investment and Golden Bridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NH Investment and Golden Bridge
The main advantage of trading using opposite NH Investment and Golden Bridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NH Investment position performs unexpectedly, Golden Bridge 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 Golden Bridge will offset losses from the drop in Golden Bridge's long position.| NH Investment vs. AptaBio Therapeutics | NH Investment vs. Daewoo SBI SPAC | NH Investment vs. Dream Security co | NH Investment vs. Microfriend |
| Golden Bridge vs. AptaBio Therapeutics | Golden Bridge vs. Daewoo SBI SPAC | Golden Bridge vs. Dream Security co | Golden Bridge vs. Microfriend |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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