Correlation Between Contemporary Amperex and Ningbo Construction
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By analyzing existing cross correlation between Contemporary Amperex Technology and Ningbo Construction Co, you can compare the effects of market volatilities on Contemporary Amperex and Ningbo Construction 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 Contemporary Amperex with a short position of Ningbo Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Contemporary Amperex and Ningbo Construction.
Diversification Opportunities for Contemporary Amperex and Ningbo Construction
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Contemporary and Ningbo is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Contemporary Amperex Technolog and Ningbo Construction Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Construction and Contemporary Amperex 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 Contemporary Amperex Technology are associated (or correlated) with Ningbo Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Construction has no effect on the direction of Contemporary Amperex i.e., Contemporary Amperex and Ningbo Construction go up and down completely randomly.
Pair Corralation between Contemporary Amperex and Ningbo Construction
Assuming the 90 days trading horizon Contemporary Amperex Technology is expected to generate 0.74 times more return on investment than Ningbo Construction. However, Contemporary Amperex Technology is 1.35 times less risky than Ningbo Construction. It trades about -0.08 of its potential returns per unit of risk. Ningbo Construction Co is currently generating about -0.16 per unit of risk. If you would invest 26,823 in Contemporary Amperex Technology on October 25, 2024 and sell it today you would lose (1,073) from holding Contemporary Amperex Technology or give up 4.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Contemporary Amperex Technolog vs. Ningbo Construction Co
Performance |
| Timeline |
| Contemporary Amperex |
| Ningbo Construction |
Contemporary Amperex and Ningbo Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Contemporary Amperex and Ningbo Construction
The main advantage of trading using opposite Contemporary Amperex and Ningbo Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Contemporary Amperex position performs unexpectedly, Ningbo Construction 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 Construction will offset losses from the drop in Ningbo Construction's long position.| Contemporary Amperex vs. Agricultural Bank of | Contemporary Amperex vs. Industrial Bank Co | Contemporary Amperex vs. Ciwen Media Co | Contemporary Amperex vs. Shanghai Xinhua Media |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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