Correlation Between Ningbo David and Lonkey Industrial
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By analyzing existing cross correlation between Ningbo David Medical and Lonkey Industrial Co, you can compare the effects of market volatilities on Ningbo David and Lonkey Industrial 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 Ningbo David with a short position of Lonkey Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo David and Lonkey Industrial.
Diversification Opportunities for Ningbo David and Lonkey Industrial
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ningbo and Lonkey is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo David Medical and Lonkey Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lonkey Industrial and Ningbo David 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 Ningbo David Medical are associated (or correlated) with Lonkey Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lonkey Industrial has no effect on the direction of Ningbo David i.e., Ningbo David and Lonkey Industrial go up and down completely randomly.
Pair Corralation between Ningbo David and Lonkey Industrial
Assuming the 90 days trading horizon Ningbo David Medical is expected to under-perform the Lonkey Industrial. In addition to that, Ningbo David is 1.14 times more volatile than Lonkey Industrial Co. It trades about -0.04 of its total potential returns per unit of risk. Lonkey Industrial Co is currently generating about 0.12 per unit of volatility. If you would invest 340.00 in Lonkey Industrial Co on September 12, 2024 and sell it today you would earn a total of 18.00 from holding Lonkey Industrial Co or generate 5.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo David Medical vs. Lonkey Industrial Co
Performance |
| Timeline |
| Ningbo David Medical |
| Lonkey Industrial |
Ningbo David and Lonkey Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo David and Lonkey Industrial
The main advantage of trading using opposite Ningbo David and Lonkey Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo David position performs unexpectedly, Lonkey Industrial 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 Lonkey Industrial will offset losses from the drop in Lonkey Industrial's long position.| Ningbo David vs. AVIC Fund Management | Ningbo David vs. TianJin 712 Communication | Ningbo David vs. Guangdong Shenglu Telecommunication | Ningbo David vs. Innovative Medical Management |
| Lonkey Industrial vs. China Petroleum Chemical | Lonkey Industrial vs. PetroChina Co Ltd | Lonkey Industrial vs. China State Construction | Lonkey Industrial vs. China Railway Group |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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