Correlation Between Ningbo Jianan and Fiberhome Telecommunicatio
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By analyzing existing cross correlation between Ningbo Jianan Electronics and Fiberhome Telecommunication Technologies, you can compare the effects of market volatilities on Ningbo Jianan and Fiberhome Telecommunicatio 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 Jianan with a short position of Fiberhome Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Jianan and Fiberhome Telecommunicatio.
Diversification Opportunities for Ningbo Jianan and Fiberhome Telecommunicatio
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Ningbo and Fiberhome is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Jianan Electronics and Fiberhome Telecommunication Te in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiberhome Telecommunicatio and Ningbo Jianan 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 Jianan Electronics are associated (or correlated) with Fiberhome Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiberhome Telecommunicatio has no effect on the direction of Ningbo Jianan i.e., Ningbo Jianan and Fiberhome Telecommunicatio go up and down completely randomly.
Pair Corralation between Ningbo Jianan and Fiberhome Telecommunicatio
Assuming the 90 days trading horizon Ningbo Jianan Electronics is expected to generate 1.51 times more return on investment than Fiberhome Telecommunicatio. However, Ningbo Jianan is 1.51 times more volatile than Fiberhome Telecommunication Technologies. It trades about 0.04 of its potential returns per unit of risk. Fiberhome Telecommunication Technologies is currently generating about 0.03 per unit of risk. If you would invest 1,530 in Ningbo Jianan Electronics on August 25, 2024 and sell it today you would earn a total of 720.00 from holding Ningbo Jianan Electronics or generate 47.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Jianan Electronics vs. Fiberhome Telecommunication Te
Performance |
| Timeline |
| Ningbo Jianan Electronics |
| Fiberhome Telecommunicatio |
Ningbo Jianan and Fiberhome Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Jianan and Fiberhome Telecommunicatio
The main advantage of trading using opposite Ningbo Jianan and Fiberhome Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Jianan position performs unexpectedly, Fiberhome Telecommunicatio 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 Fiberhome Telecommunicatio will offset losses from the drop in Fiberhome Telecommunicatio's long position.| Ningbo Jianan vs. CSSC Offshore Marine | Ningbo Jianan vs. Shanghai Yaoji Playing | Ningbo Jianan vs. Chongqing Brewery Co | Ningbo Jianan vs. Pengxin International Mining |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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