Correlation Between Nanjing Putian and Weihai Guangwei
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By analyzing existing cross correlation between Nanjing Putian Telecommunications and Weihai Guangwei Composites, you can compare the effects of market volatilities on Nanjing Putian and Weihai Guangwei 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 Weihai Guangwei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Putian and Weihai Guangwei.
Diversification Opportunities for Nanjing Putian and Weihai Guangwei
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nanjing and Weihai is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Putian Telecommunicati and Weihai Guangwei Composites in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weihai Guangwei Comp 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 Weihai Guangwei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weihai Guangwei Comp has no effect on the direction of Nanjing Putian i.e., Nanjing Putian and Weihai Guangwei go up and down completely randomly.
Pair Corralation between Nanjing Putian and Weihai Guangwei
Assuming the 90 days trading horizon Nanjing Putian Telecommunications is expected to under-perform the Weihai Guangwei. In addition to that, Nanjing Putian is 2.15 times more volatile than Weihai Guangwei Composites. It trades about -0.1 of its total potential returns per unit of risk. Weihai Guangwei Composites is currently generating about -0.12 per unit of volatility. If you would invest 3,632 in Weihai Guangwei Composites on September 15, 2024 and sell it today you would lose (234.00) from holding Weihai Guangwei Composites or give up 6.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing Putian Telecommunicati vs. Weihai Guangwei Composites
Performance |
| Timeline |
| Nanjing Putian Telec |
| Weihai Guangwei Comp |
Nanjing Putian and Weihai Guangwei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Putian and Weihai Guangwei
The main advantage of trading using opposite Nanjing Putian and Weihai Guangwei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Putian position performs unexpectedly, Weihai Guangwei 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 Weihai Guangwei will offset losses from the drop in Weihai Guangwei's long position.| Nanjing Putian vs. Industrial and Commercial | Nanjing Putian vs. China Construction Bank | Nanjing Putian vs. Bank of China | Nanjing Putian vs. Agricultural Bank of |
| Weihai Guangwei vs. Yunnan Jianzhijia Health Chain | Weihai Guangwei vs. Anhui Huaren Health | Weihai Guangwei vs. PKU HealthCare Corp | Weihai Guangwei vs. Huaibei Mining Holdings |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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