Correlation Between Nanjing Putian and Zhongtong Guomai
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By analyzing existing cross correlation between Nanjing Putian Telecommunications and Zhongtong Guomai Communication, you can compare the effects of market volatilities on Nanjing Putian and Zhongtong Guomai 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 Zhongtong Guomai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Putian and Zhongtong Guomai.
Diversification Opportunities for Nanjing Putian and Zhongtong Guomai
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nanjing and Zhongtong is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Putian Telecommunicati and Zhongtong Guomai Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongtong Guomai Com 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 Zhongtong Guomai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongtong Guomai Com has no effect on the direction of Nanjing Putian i.e., Nanjing Putian and Zhongtong Guomai go up and down completely randomly.
Pair Corralation between Nanjing Putian and Zhongtong Guomai
Assuming the 90 days trading horizon Nanjing Putian Telecommunications is expected to under-perform the Zhongtong Guomai. But the stock apears to be less risky and, when comparing its historical volatility, Nanjing Putian Telecommunications is 1.12 times less risky than Zhongtong Guomai. The stock trades about -0.02 of its potential returns per unit of risk. The Zhongtong Guomai Communication is currently generating about 0.54 of returns per unit of risk over similar time horizon. If you would invest 717.00 in Zhongtong Guomai Communication on November 28, 2024 and sell it today you would earn a total of 182.00 from holding Zhongtong Guomai Communication or generate 25.38% 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. Zhongtong Guomai Communication
Performance |
| Timeline |
| Nanjing Putian Telec |
| Zhongtong Guomai Com |
Nanjing Putian and Zhongtong Guomai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Putian and Zhongtong Guomai
The main advantage of trading using opposite Nanjing Putian and Zhongtong Guomai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Putian position performs unexpectedly, Zhongtong Guomai 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 Zhongtong Guomai will offset losses from the drop in Zhongtong Guomai's long position.| Nanjing Putian vs. PetroChina Co Ltd | Nanjing Putian vs. Industrial and Commercial | Nanjing Putian vs. China Petroleum Chemical | Nanjing Putian vs. China Construction Bank |
| Zhongtong Guomai vs. Cicc Fund Management | Zhongtong Guomai vs. Xiamen Insight Investment | Zhongtong Guomai vs. Hubei Geoway Investment | Zhongtong Guomai vs. Postal Savings Bank |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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