Correlation Between Ningbo MedicalSystem and Guangdong Transtek
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By analyzing existing cross correlation between Ningbo MedicalSystem Biotechnology and Guangdong Transtek Medical, you can compare the effects of market volatilities on Ningbo MedicalSystem and Guangdong Transtek 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 MedicalSystem with a short position of Guangdong Transtek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo MedicalSystem and Guangdong Transtek.
Diversification Opportunities for Ningbo MedicalSystem and Guangdong Transtek
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ningbo and Guangdong is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo MedicalSystem Biotechno and Guangdong Transtek Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Transtek and Ningbo MedicalSystem 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 MedicalSystem Biotechnology are associated (or correlated) with Guangdong Transtek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Transtek has no effect on the direction of Ningbo MedicalSystem i.e., Ningbo MedicalSystem and Guangdong Transtek go up and down completely randomly.
Pair Corralation between Ningbo MedicalSystem and Guangdong Transtek
Assuming the 90 days trading horizon Ningbo MedicalSystem Biotechnology is expected to under-perform the Guangdong Transtek. But the stock apears to be less risky and, when comparing its historical volatility, Ningbo MedicalSystem Biotechnology is 3.0 times less risky than Guangdong Transtek. The stock trades about -0.18 of its potential returns per unit of risk. The Guangdong Transtek Medical is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 1,469 in Guangdong Transtek Medical on October 30, 2024 and sell it today you would lose (204.00) from holding Guangdong Transtek Medical or give up 13.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo MedicalSystem Biotechno vs. Guangdong Transtek Medical
Performance |
| Timeline |
| Ningbo MedicalSystem |
| Guangdong Transtek |
Ningbo MedicalSystem and Guangdong Transtek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo MedicalSystem and Guangdong Transtek
The main advantage of trading using opposite Ningbo MedicalSystem and Guangdong Transtek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo MedicalSystem position performs unexpectedly, Guangdong Transtek 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 Guangdong Transtek will offset losses from the drop in Guangdong Transtek's long position.| Ningbo MedicalSystem vs. Fuda Alloy Materials | Ningbo MedicalSystem vs. Swancor Advanced Materials | Ningbo MedicalSystem vs. Suzhou Xingye Material | Ningbo MedicalSystem vs. Shanghai Yaoji Playing |
| Guangdong Transtek vs. Agricultural Bank of | Guangdong Transtek vs. Industrial and Commercial | Guangdong Transtek vs. Bank of China | Guangdong Transtek vs. China Construction Bank |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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