Correlation Between Nanjing Putian and Hubei Tech
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By analyzing existing cross correlation between Nanjing Putian Telecommunications and Hubei Tech Semiconductors, you can compare the effects of market volatilities on Nanjing Putian and Hubei Tech 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 Hubei Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Putian and Hubei Tech.
Diversification Opportunities for Nanjing Putian and Hubei Tech
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nanjing and Hubei is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Putian Telecommunicati and Hubei Tech Semiconductors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Tech Semiconductors 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 Hubei Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Tech Semiconductors has no effect on the direction of Nanjing Putian i.e., Nanjing Putian and Hubei Tech go up and down completely randomly.
Pair Corralation between Nanjing Putian and Hubei Tech
Assuming the 90 days trading horizon Nanjing Putian Telecommunications is expected to generate 1.2 times more return on investment than Hubei Tech. However, Nanjing Putian is 1.2 times more volatile than Hubei Tech Semiconductors. It trades about 0.34 of its potential returns per unit of risk. Hubei Tech Semiconductors is currently generating about 0.05 per unit of risk. If you would invest 318.00 in Nanjing Putian Telecommunications on November 5, 2024 and sell it today you would earn a total of 70.00 from holding Nanjing Putian Telecommunications or generate 22.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing Putian Telecommunicati vs. Hubei Tech Semiconductors
Performance |
| Timeline |
| Nanjing Putian Telec |
| Hubei Tech Semiconductors |
Nanjing Putian and Hubei Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Putian and Hubei Tech
The main advantage of trading using opposite Nanjing Putian and Hubei Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Putian position performs unexpectedly, Hubei Tech 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 Hubei Tech will offset losses from the drop in Hubei Tech's long position.| Nanjing Putian vs. Sharetronic Data Technology | Nanjing Putian vs. Bonree Data Technology | Nanjing Putian vs. Shenyang Chemical Industry | Nanjing Putian vs. Xinxiang Chemical Fiber |
| Hubei Tech vs. China Publishing Media | Hubei Tech vs. Ningbo Fangzheng Automobile | Hubei Tech vs. Simei Media Co | Hubei Tech vs. Ciwen Media 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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