Correlation Between Nanjing Putian and Shanghai Shibei
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By analyzing existing cross correlation between Nanjing Putian Telecommunications and Shanghai Shibei Hi Tech, you can compare the effects of market volatilities on Nanjing Putian and Shanghai Shibei 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 Shanghai Shibei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Putian and Shanghai Shibei.
Diversification Opportunities for Nanjing Putian and Shanghai Shibei
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nanjing and Shanghai is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Putian Telecommunicati and Shanghai Shibei Hi Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Shibei Hi 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 Shanghai Shibei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Shibei Hi has no effect on the direction of Nanjing Putian i.e., Nanjing Putian and Shanghai Shibei go up and down completely randomly.
Pair Corralation between Nanjing Putian and Shanghai Shibei
Assuming the 90 days trading horizon Nanjing Putian Telecommunications is expected to generate 0.91 times more return on investment than Shanghai Shibei. However, Nanjing Putian Telecommunications is 1.09 times less risky than Shanghai Shibei. It trades about -0.2 of its potential returns per unit of risk. Shanghai Shibei Hi Tech is currently generating about -0.21 per unit of risk. If you would invest 436.00 in Nanjing Putian Telecommunications on October 12, 2024 and sell it today you would lose (74.00) from holding Nanjing Putian Telecommunications or give up 16.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing Putian Telecommunicati vs. Shanghai Shibei Hi Tech
Performance |
| Timeline |
| Nanjing Putian Telec |
| Shanghai Shibei Hi |
Nanjing Putian and Shanghai Shibei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Putian and Shanghai Shibei
The main advantage of trading using opposite Nanjing Putian and Shanghai Shibei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Putian position performs unexpectedly, Shanghai Shibei 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 Shanghai Shibei will offset losses from the drop in Shanghai Shibei's long position.| Nanjing Putian vs. Cultural Investment Holdings | Nanjing Putian vs. Jiangsu Yanghe Brewery | Nanjing Putian vs. Tieling Newcity Investment | Nanjing Putian vs. Dareway Software Co |
| Shanghai Shibei vs. Ming Yang Smart | Shanghai Shibei vs. 159681 | Shanghai Shibei vs. 159005 | Shanghai Shibei vs. Loctek Ergonomic Technology |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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