Correlation Between Ningbo Jianan and Caihong Display
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By analyzing existing cross correlation between Ningbo Jianan Electronics and Caihong Display Devices, you can compare the effects of market volatilities on Ningbo Jianan and Caihong Display 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 Caihong Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Jianan and Caihong Display.
Diversification Opportunities for Ningbo Jianan and Caihong Display
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ningbo and Caihong is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Jianan Electronics and Caihong Display Devices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caihong Display Devices 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 Caihong Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caihong Display Devices has no effect on the direction of Ningbo Jianan i.e., Ningbo Jianan and Caihong Display go up and down completely randomly.
Pair Corralation between Ningbo Jianan and Caihong Display
Assuming the 90 days trading horizon Ningbo Jianan Electronics is expected to generate 1.29 times more return on investment than Caihong Display. However, Ningbo Jianan is 1.29 times more volatile than Caihong Display Devices. It trades about 0.1 of its potential returns per unit of risk. Caihong Display Devices is currently generating about -0.12 per unit of risk. If you would invest 2,264 in Ningbo Jianan Electronics on August 29, 2024 and sell it today you would earn a total of 148.00 from holding Ningbo Jianan Electronics or generate 6.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Jianan Electronics vs. Caihong Display Devices
Performance |
| Timeline |
| Ningbo Jianan Electronics |
| Caihong Display Devices |
Ningbo Jianan and Caihong Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Jianan and Caihong Display
The main advantage of trading using opposite Ningbo Jianan and Caihong Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Jianan position performs unexpectedly, Caihong Display 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 Caihong Display will offset losses from the drop in Caihong Display's long position.| Ningbo Jianan vs. Caihong Display Devices | Ningbo Jianan vs. Shuhua Sports Co | Ningbo Jianan vs. Beijing Mainstreets Investment | Ningbo Jianan vs. Jiangsu Jinling Sports |
| Caihong Display vs. China State Construction | Caihong Display vs. Huafa Industrial Co | Caihong Display vs. China International Capital | Caihong Display vs. Kweichow Moutai Co |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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