Correlation Between Nanjing Putian and Shenzhen
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By analyzing existing cross correlation between Nanjing Putian Telecommunications and Shenzhen SC New, you can compare the effects of market volatilities on Nanjing Putian and Shenzhen 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 Shenzhen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Putian and Shenzhen.
Diversification Opportunities for Nanjing Putian and Shenzhen
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nanjing and Shenzhen is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Putian Telecommunicati and Shenzhen SC New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen SC New 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 Shenzhen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen SC New has no effect on the direction of Nanjing Putian i.e., Nanjing Putian and Shenzhen go up and down completely randomly.
Pair Corralation between Nanjing Putian and Shenzhen
Assuming the 90 days trading horizon Nanjing Putian Telecommunications is expected to generate 1.05 times more return on investment than Shenzhen. However, Nanjing Putian is 1.05 times more volatile than Shenzhen SC New. It trades about 0.21 of its potential returns per unit of risk. Shenzhen SC New is currently generating about 0.04 per unit of risk. If you would invest 154.00 in Nanjing Putian Telecommunications on September 3, 2024 and sell it today you would earn a total of 306.00 from holding Nanjing Putian Telecommunications or generate 198.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing Putian Telecommunicati vs. Shenzhen SC New
Performance |
| Timeline |
| Nanjing Putian Telec |
| Shenzhen SC New |
Nanjing Putian and Shenzhen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Putian and Shenzhen
The main advantage of trading using opposite Nanjing Putian and Shenzhen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Putian position performs unexpectedly, Shenzhen 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 Shenzhen will offset losses from the drop in Shenzhen's long position.| Nanjing Putian vs. Agricultural Bank of | Nanjing Putian vs. China Construction Bank | Nanjing Putian vs. Postal Savings Bank | Nanjing Putian vs. Bank of Communications |
| Shenzhen vs. Hangzhou Pinming Software | Shenzhen vs. CSSC Offshore Marine | Shenzhen vs. Glodon Software Co | Shenzhen vs. Offshore Oil Engineering |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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