Correlation Between Jinlong Machinery and Ningbo Kangqiang
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By analyzing existing cross correlation between Jinlong Machinery Electronic and Ningbo Kangqiang Electronics, you can compare the effects of market volatilities on Jinlong Machinery and Ningbo Kangqiang 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 Jinlong Machinery with a short position of Ningbo Kangqiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinlong Machinery and Ningbo Kangqiang.
Diversification Opportunities for Jinlong Machinery and Ningbo Kangqiang
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Jinlong and Ningbo is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Jinlong Machinery Electronic and Ningbo Kangqiang Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Kangqiang Ele and Jinlong Machinery 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 Jinlong Machinery Electronic are associated (or correlated) with Ningbo Kangqiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Kangqiang Ele has no effect on the direction of Jinlong Machinery i.e., Jinlong Machinery and Ningbo Kangqiang go up and down completely randomly.
Pair Corralation between Jinlong Machinery and Ningbo Kangqiang
Assuming the 90 days trading horizon Jinlong Machinery Electronic is expected to under-perform the Ningbo Kangqiang. But the stock apears to be less risky and, when comparing its historical volatility, Jinlong Machinery Electronic is 1.43 times less risky than Ningbo Kangqiang. The stock trades about -0.43 of its potential returns per unit of risk. The Ningbo Kangqiang Electronics is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 1,514 in Ningbo Kangqiang Electronics on October 12, 2024 and sell it today you would earn a total of 203.00 from holding Ningbo Kangqiang Electronics or generate 13.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinlong Machinery Electronic vs. Ningbo Kangqiang Electronics
Performance |
| Timeline |
| Jinlong Machinery |
| Ningbo Kangqiang Ele |
Jinlong Machinery and Ningbo Kangqiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinlong Machinery and Ningbo Kangqiang
The main advantage of trading using opposite Jinlong Machinery and Ningbo Kangqiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinlong Machinery position performs unexpectedly, Ningbo Kangqiang 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 Ningbo Kangqiang will offset losses from the drop in Ningbo Kangqiang's long position.| Jinlong Machinery vs. Financial Street Holdings | Jinlong Machinery vs. Ping An Insurance | Jinlong Machinery vs. Panda Financial Holding | Jinlong Machinery vs. GRG Banking Equipment |
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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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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