Correlation Between Boai NKY and Zhejiang Juhua
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By analyzing existing cross correlation between Boai NKY Pharmaceuticals and Zhejiang Juhua Co, you can compare the effects of market volatilities on Boai NKY and Zhejiang Juhua 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 Boai NKY with a short position of Zhejiang Juhua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boai NKY and Zhejiang Juhua.
Diversification Opportunities for Boai NKY and Zhejiang Juhua
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Boai and Zhejiang is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Boai NKY Pharmaceuticals and Zhejiang Juhua Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Juhua and Boai NKY 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 Boai NKY Pharmaceuticals are associated (or correlated) with Zhejiang Juhua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Juhua has no effect on the direction of Boai NKY i.e., Boai NKY and Zhejiang Juhua go up and down completely randomly.
Pair Corralation between Boai NKY and Zhejiang Juhua
Assuming the 90 days trading horizon Boai NKY Pharmaceuticals is expected to generate 1.47 times more return on investment than Zhejiang Juhua. However, Boai NKY is 1.47 times more volatile than Zhejiang Juhua Co. It trades about 0.22 of its potential returns per unit of risk. Zhejiang Juhua Co is currently generating about 0.05 per unit of risk. If you would invest 1,264 in Boai NKY Pharmaceuticals on September 5, 2024 and sell it today you would earn a total of 215.00 from holding Boai NKY Pharmaceuticals or generate 17.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boai NKY Pharmaceuticals vs. Zhejiang Juhua Co
Performance |
| Timeline |
| Boai NKY Pharmaceuticals |
| Zhejiang Juhua |
Boai NKY and Zhejiang Juhua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boai NKY and Zhejiang Juhua
The main advantage of trading using opposite Boai NKY and Zhejiang Juhua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boai NKY position performs unexpectedly, Zhejiang Juhua 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 Zhejiang Juhua will offset losses from the drop in Zhejiang Juhua's long position.| Boai NKY vs. Zijin Mining Group | Boai NKY vs. Wanhua Chemical Group | Boai NKY vs. Baoshan Iron Steel | Boai NKY vs. Rongsheng Petrochemical Co |
| Zhejiang Juhua vs. Zijin Mining Group | Zhejiang Juhua vs. Wanhua Chemical Group | Zhejiang Juhua vs. Baoshan Iron Steel | Zhejiang Juhua vs. Shandong Gold Mining |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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