Correlation Between Nanjing Putian and UE Furniture
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By analyzing existing cross correlation between Nanjing Putian Telecommunications and UE Furniture Co, you can compare the effects of market volatilities on Nanjing Putian and UE Furniture 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 UE Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Putian and UE Furniture.
Diversification Opportunities for Nanjing Putian and UE Furniture
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nanjing and 603600 is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Putian Telecommunicati and UE Furniture Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UE Furniture 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 UE Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UE Furniture has no effect on the direction of Nanjing Putian i.e., Nanjing Putian and UE Furniture go up and down completely randomly.
Pair Corralation between Nanjing Putian and UE Furniture
Assuming the 90 days trading horizon Nanjing Putian is expected to generate 2.61 times less return on investment than UE Furniture. In addition to that, Nanjing Putian is 2.95 times more volatile than UE Furniture Co. It trades about 0.01 of its total potential returns per unit of risk. UE Furniture Co is currently generating about 0.05 per unit of volatility. If you would invest 1,181 in UE Furniture Co on September 12, 2024 and sell it today you would earn a total of 19.00 from holding UE Furniture Co or generate 1.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing Putian Telecommunicati vs. UE Furniture Co
Performance |
| Timeline |
| Nanjing Putian Telec |
| UE Furniture |
Nanjing Putian and UE Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Putian and UE Furniture
The main advantage of trading using opposite Nanjing Putian and UE Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Putian position performs unexpectedly, UE Furniture 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 UE Furniture will offset losses from the drop in UE Furniture's long position.| Nanjing Putian vs. Gansu Jiu Steel | Nanjing Putian vs. Shandong Mining Machinery | Nanjing Putian vs. Aba Chemicals Corp | Nanjing Putian vs. BlueFocus Communication Group |
| UE Furniture vs. Agricultural Bank of | UE Furniture vs. Industrial and Commercial | UE Furniture vs. Bank of China | UE Furniture vs. PetroChina Co Ltd |
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