Correlation Between Jiangxi Naipu and Ningbo Construction
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By analyzing existing cross correlation between Jiangxi Naipu Mining and Ningbo Construction Co, you can compare the effects of market volatilities on Jiangxi Naipu 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 Jiangxi Naipu with a short position of Ningbo Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangxi Naipu and Ningbo Construction.
Diversification Opportunities for Jiangxi Naipu and Ningbo Construction
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiangxi and Ningbo is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Jiangxi Naipu Mining and Ningbo Construction Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Construction and Jiangxi Naipu 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 Jiangxi Naipu Mining 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 Jiangxi Naipu i.e., Jiangxi Naipu and Ningbo Construction go up and down completely randomly.
Pair Corralation between Jiangxi Naipu and Ningbo Construction
Assuming the 90 days trading horizon Jiangxi Naipu Mining is expected to under-perform the Ningbo Construction. In addition to that, Jiangxi Naipu is 1.09 times more volatile than Ningbo Construction Co. It trades about -0.04 of its total potential returns per unit of risk. Ningbo Construction Co is currently generating about 0.09 per unit of volatility. If you would invest 410.00 in Ningbo Construction Co on November 5, 2024 and sell it today you would earn a total of 9.00 from holding Ningbo Construction Co or generate 2.2% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Jiangxi Naipu Mining vs. Ningbo Construction Co
Performance |
Timeline |
Jiangxi Naipu Mining |
Ningbo Construction |
Jiangxi Naipu and Ningbo Construction Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jiangxi Naipu and Ningbo Construction
The main advantage of trading using opposite Jiangxi Naipu and Ningbo Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangxi Naipu 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.Jiangxi Naipu vs. China Sports Industry | Jiangxi Naipu vs. Youyou Foods Co | Jiangxi Naipu vs. Hubeiyichang Transportation Group | Jiangxi Naipu vs. Sportsoul Co Ltd |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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