Correlation Between Wuxi Xuelang and Ningbo Kangqiang
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By analyzing existing cross correlation between Wuxi Xuelang Environmental and Ningbo Kangqiang Electronics, you can compare the effects of market volatilities on Wuxi Xuelang 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 Wuxi Xuelang with a short position of Ningbo Kangqiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuxi Xuelang and Ningbo Kangqiang.
Diversification Opportunities for Wuxi Xuelang and Ningbo Kangqiang
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wuxi and Ningbo is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Wuxi Xuelang Environmental 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 Wuxi Xuelang 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 Wuxi Xuelang Environmental 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 Wuxi Xuelang i.e., Wuxi Xuelang and Ningbo Kangqiang go up and down completely randomly.
Pair Corralation between Wuxi Xuelang and Ningbo Kangqiang
Assuming the 90 days trading horizon Wuxi Xuelang Environmental is expected to under-perform the Ningbo Kangqiang. But the stock apears to be less risky and, when comparing its historical volatility, Wuxi Xuelang Environmental is 2.02 times less risky than Ningbo Kangqiang. The stock trades about -0.08 of its potential returns per unit of risk. The Ningbo Kangqiang Electronics is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,649 in Ningbo Kangqiang Electronics on October 31, 2024 and sell it today you would earn a total of 64.00 from holding Ningbo Kangqiang Electronics or generate 3.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wuxi Xuelang Environmental vs. Ningbo Kangqiang Electronics
Performance |
| Timeline |
| Wuxi Xuelang Environ |
| Ningbo Kangqiang Ele |
Wuxi Xuelang and Ningbo Kangqiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wuxi Xuelang and Ningbo Kangqiang
The main advantage of trading using opposite Wuxi Xuelang and Ningbo Kangqiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuxi Xuelang 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.| Wuxi Xuelang vs. China Longyuan Power | Wuxi Xuelang vs. PetroChina Co Ltd | Wuxi Xuelang vs. Guangxi Guiguan Electric | Wuxi Xuelang vs. Yantai North Andre |
| Ningbo Kangqiang vs. Touchstone International Medical | Ningbo Kangqiang vs. Lootom Telcovideo Network | Ningbo Kangqiang vs. Winner Medical Co | Ningbo Kangqiang vs. Qingdao Haier Biomedical |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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