Correlation Between Nanjing Putian and Zhongyin Babi
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By analyzing existing cross correlation between Nanjing Putian Telecommunications and Zhongyin Babi Food, you can compare the effects of market volatilities on Nanjing Putian and Zhongyin Babi 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 Zhongyin Babi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Putian and Zhongyin Babi.
Diversification Opportunities for Nanjing Putian and Zhongyin Babi
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nanjing and Zhongyin is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Putian Telecommunicati and Zhongyin Babi Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongyin Babi Food 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 Zhongyin Babi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongyin Babi Food has no effect on the direction of Nanjing Putian i.e., Nanjing Putian and Zhongyin Babi go up and down completely randomly.
Pair Corralation between Nanjing Putian and Zhongyin Babi
Assuming the 90 days trading horizon Nanjing Putian Telecommunications is expected to generate 2.17 times more return on investment than Zhongyin Babi. However, Nanjing Putian is 2.17 times more volatile than Zhongyin Babi Food. It trades about 0.23 of its potential returns per unit of risk. Zhongyin Babi Food is currently generating about 0.11 per unit of risk. If you would invest 379.00 in Nanjing Putian Telecommunications on September 1, 2024 and sell it today you would earn a total of 81.00 from holding Nanjing Putian Telecommunications or generate 21.37% 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. Zhongyin Babi Food
Performance |
| Timeline |
| Nanjing Putian Telec |
| Zhongyin Babi Food |
Nanjing Putian and Zhongyin Babi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Putian and Zhongyin Babi
The main advantage of trading using opposite Nanjing Putian and Zhongyin Babi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Putian position performs unexpectedly, Zhongyin Babi 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 Zhongyin Babi will offset losses from the drop in Zhongyin Babi's long position.| Nanjing Putian vs. Tieling Newcity Investment | Nanjing Putian vs. Yindu Kitchen Equipment | Nanjing Putian vs. Zhongrun Resources Investment | Nanjing Putian vs. Xiandai Investment Co |
| Zhongyin Babi vs. Nanjing Putian Telecommunications | Zhongyin Babi vs. Shenzhen Hifuture Electric | Zhongyin Babi vs. Tianjin Realty Development | Zhongyin Babi vs. Shenyang Huitian Thermal |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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