Correlation Between Ningbo MedicalSystem and Zhengping RoadBridge
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By analyzing existing cross correlation between Ningbo MedicalSystem Biotechnology and Zhengping RoadBridge Constr, you can compare the effects of market volatilities on Ningbo MedicalSystem and Zhengping RoadBridge 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 Zhengping RoadBridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo MedicalSystem and Zhengping RoadBridge.
Diversification Opportunities for Ningbo MedicalSystem and Zhengping RoadBridge
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ningbo and Zhengping is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo MedicalSystem Biotechno and Zhengping RoadBridge Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhengping RoadBridge 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 Zhengping RoadBridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhengping RoadBridge has no effect on the direction of Ningbo MedicalSystem i.e., Ningbo MedicalSystem and Zhengping RoadBridge go up and down completely randomly.
Pair Corralation between Ningbo MedicalSystem and Zhengping RoadBridge
Assuming the 90 days trading horizon Ningbo MedicalSystem Biotechnology is expected to under-perform the Zhengping RoadBridge. But the stock apears to be less risky and, when comparing its historical volatility, Ningbo MedicalSystem Biotechnology is 2.4 times less risky than Zhengping RoadBridge. The stock trades about -0.16 of its potential returns per unit of risk. The Zhengping RoadBridge Constr is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 313.00 in Zhengping RoadBridge Constr on October 11, 2024 and sell it today you would earn a total of 56.00 from holding Zhengping RoadBridge Constr or generate 17.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo MedicalSystem Biotechno vs. Zhengping RoadBridge Constr
Performance |
| Timeline |
| Ningbo MedicalSystem |
| Zhengping RoadBridge |
Ningbo MedicalSystem and Zhengping RoadBridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo MedicalSystem and Zhengping RoadBridge
The main advantage of trading using opposite Ningbo MedicalSystem and Zhengping RoadBridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo MedicalSystem position performs unexpectedly, Zhengping RoadBridge 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 Zhengping RoadBridge will offset losses from the drop in Zhengping RoadBridge's long position.| Ningbo MedicalSystem vs. City Development Environment | Ningbo MedicalSystem vs. Hunan Tyen Machinery | Ningbo MedicalSystem vs. Masterwork Machinery | Ningbo MedicalSystem vs. Jinlong Machinery Electronic |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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