Correlation Between Nanjing Putian and Jiangsu Xinning
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By analyzing existing cross correlation between Nanjing Putian Telecommunications and Jiangsu Xinning Modern, you can compare the effects of market volatilities on Nanjing Putian and Jiangsu Xinning 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 Jiangsu Xinning. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Putian and Jiangsu Xinning.
Diversification Opportunities for Nanjing Putian and Jiangsu Xinning
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Nanjing and Jiangsu is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Putian Telecommunicati and Jiangsu Xinning Modern in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Xinning Modern 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 Jiangsu Xinning. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Xinning Modern has no effect on the direction of Nanjing Putian i.e., Nanjing Putian and Jiangsu Xinning go up and down completely randomly.
Pair Corralation between Nanjing Putian and Jiangsu Xinning
Assuming the 90 days trading horizon Nanjing Putian is expected to generate 1.99 times less return on investment than Jiangsu Xinning. But when comparing it to its historical volatility, Nanjing Putian Telecommunications is 1.03 times less risky than Jiangsu Xinning. It trades about 0.12 of its potential returns per unit of risk. Jiangsu Xinning Modern is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 325.00 in Jiangsu Xinning Modern on August 29, 2024 and sell it today you would earn a total of 73.00 from holding Jiangsu Xinning Modern or generate 22.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing Putian Telecommunicati vs. Jiangsu Xinning Modern
Performance |
| Timeline |
| Nanjing Putian Telec |
| Jiangsu Xinning Modern |
Nanjing Putian and Jiangsu Xinning Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Putian and Jiangsu Xinning
The main advantage of trading using opposite Nanjing Putian and Jiangsu Xinning positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Putian position performs unexpectedly, Jiangsu Xinning 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 Jiangsu Xinning will offset losses from the drop in Jiangsu Xinning's long position.| Nanjing Putian vs. China State Construction | Nanjing Putian vs. Huafa Industrial Co | Nanjing Putian vs. China International Capital | Nanjing Putian vs. Kweichow Moutai Co |
| Jiangsu Xinning vs. China Sports Industry | Jiangsu Xinning vs. ZYF Lopsking Aluminum | Jiangsu Xinning vs. Sunny Loan Top | Jiangsu Xinning vs. Anhui Transport Consulting |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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