Correlation Between 159005 and Nanxing Furniture
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By analyzing existing cross correlation between 159005 and Nanxing Furniture Machinery, you can compare the effects of market volatilities on 159005 and Nanxing Furniture 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 159005 with a short position of Nanxing Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of 159005 and Nanxing Furniture.
Diversification Opportunities for 159005 and Nanxing Furniture
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 159005 and Nanxing is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding 159005 and Nanxing Furniture Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanxing Furniture and 159005 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 159005 are associated (or correlated) with Nanxing Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanxing Furniture has no effect on the direction of 159005 i.e., 159005 and Nanxing Furniture go up and down completely randomly.
Pair Corralation between 159005 and Nanxing Furniture
Assuming the 90 days trading horizon 159005 is expected to generate 18.55 times less return on investment than Nanxing Furniture. But when comparing it to its historical volatility, 159005 is 100.09 times less risky than Nanxing Furniture. It trades about 0.21 of its potential returns per unit of risk. Nanxing Furniture Machinery is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,355 in Nanxing Furniture Machinery on September 3, 2024 and sell it today you would earn a total of 164.00 from holding Nanxing Furniture Machinery or generate 12.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
159005 vs. Nanxing Furniture Machinery
Performance |
| Timeline |
| 159005 |
| Nanxing Furniture |
159005 and Nanxing Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 159005 and Nanxing Furniture
The main advantage of trading using opposite 159005 and Nanxing Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 159005 position performs unexpectedly, Nanxing Furniture 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 Nanxing Furniture will offset losses from the drop in Nanxing Furniture's long position.The idea behind 159005 and Nanxing Furniture Machinery 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.| Nanxing Furniture vs. Cultural Investment Holdings | Nanxing Furniture vs. Gome Telecom Equipment | Nanxing Furniture vs. Bus Online Co | Nanxing Furniture vs. Holitech Technology Co |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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