Correlation Between Nanjing Putian and Guizhou Chanhen
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By analyzing existing cross correlation between Nanjing Putian Telecommunications and Guizhou Chanhen Chemical, you can compare the effects of market volatilities on Nanjing Putian and Guizhou Chanhen 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 Nanjing Putian with a short position of Guizhou Chanhen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Putian and Guizhou Chanhen.
Diversification Opportunities for Nanjing Putian and Guizhou Chanhen
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nanjing and Guizhou is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Putian Telecommunicati and Guizhou Chanhen Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guizhou Chanhen Chemical and Nanjing Putian 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 Nanjing Putian Telecommunications are associated (or correlated) with Guizhou Chanhen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guizhou Chanhen Chemical has no effect on the direction of Nanjing Putian i.e., Nanjing Putian and Guizhou Chanhen go up and down completely randomly.
Pair Corralation between Nanjing Putian and Guizhou Chanhen
Assuming the 90 days trading horizon Nanjing Putian Telecommunications is expected to under-perform the Guizhou Chanhen. In addition to that, Nanjing Putian is 2.24 times more volatile than Guizhou Chanhen Chemical. It trades about -0.08 of its total potential returns per unit of risk. Guizhou Chanhen Chemical is currently generating about -0.03 per unit of volatility. If you would invest 2,302 in Guizhou Chanhen Chemical on October 30, 2024 and sell it today you would lose (62.00) from holding Guizhou Chanhen Chemical or give up 2.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing Putian Telecommunicati vs. Guizhou Chanhen Chemical
Performance |
| Timeline |
| Nanjing Putian Telec |
| Guizhou Chanhen Chemical |
Nanjing Putian and Guizhou Chanhen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Putian and Guizhou Chanhen
The main advantage of trading using opposite Nanjing Putian and Guizhou Chanhen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Putian position performs unexpectedly, Guizhou Chanhen 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 Guizhou Chanhen will offset losses from the drop in Guizhou Chanhen's long position.| Nanjing Putian vs. Tongyu Communication | Nanjing Putian vs. Eastern Air Logistics | Nanjing Putian vs. Xizi Clean Energy | Nanjing Putian vs. Lootom Telcovideo Network |
| Guizhou Chanhen vs. Harbin Air Conditioning | Guizhou Chanhen vs. Jiangsu Phoenix Publishing | Guizhou Chanhen vs. Air China Ltd | Guizhou Chanhen vs. COL Digital Publishing |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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