Correlation Between Penyao Environmental and NAURA Technology
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By analyzing existing cross correlation between Penyao Environmental Protection and NAURA Technology Group, you can compare the effects of market volatilities on Penyao Environmental and NAURA Technology 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 Penyao Environmental with a short position of NAURA Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penyao Environmental and NAURA Technology.
Diversification Opportunities for Penyao Environmental and NAURA Technology
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Penyao and NAURA is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Penyao Environmental Protectio and NAURA Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NAURA Technology and Penyao Environmental 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 Penyao Environmental Protection are associated (or correlated) with NAURA Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NAURA Technology has no effect on the direction of Penyao Environmental i.e., Penyao Environmental and NAURA Technology go up and down completely randomly.
Pair Corralation between Penyao Environmental and NAURA Technology
Assuming the 90 days trading horizon Penyao Environmental Protection is expected to under-perform the NAURA Technology. In addition to that, Penyao Environmental is 1.55 times more volatile than NAURA Technology Group. It trades about -0.1 of its total potential returns per unit of risk. NAURA Technology Group is currently generating about -0.09 per unit of volatility. If you would invest 40,350 in NAURA Technology Group on October 23, 2024 and sell it today you would lose (1,492) from holding NAURA Technology Group or give up 3.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Penyao Environmental Protectio vs. NAURA Technology Group
Performance |
| Timeline |
| Penyao Environmental |
| NAURA Technology |
Penyao Environmental and NAURA Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Penyao Environmental and NAURA Technology
The main advantage of trading using opposite Penyao Environmental and NAURA Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penyao Environmental position performs unexpectedly, NAURA Technology 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 NAURA Technology will offset losses from the drop in NAURA Technology's long position.| Penyao Environmental vs. New China Life | Penyao Environmental vs. Ming Yang Smart | Penyao Environmental vs. 159681 | Penyao Environmental vs. 159005 |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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