Correlation Between Ningbo Jianan and Guangdong Skychem
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By analyzing existing cross correlation between Ningbo Jianan Electronics and Guangdong Skychem Technology, you can compare the effects of market volatilities on Ningbo Jianan and Guangdong Skychem 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 Guangdong Skychem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Jianan and Guangdong Skychem.
Diversification Opportunities for Ningbo Jianan and Guangdong Skychem
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ningbo and Guangdong is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Jianan Electronics and Guangdong Skychem Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Skychem 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 Guangdong Skychem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Skychem has no effect on the direction of Ningbo Jianan i.e., Ningbo Jianan and Guangdong Skychem go up and down completely randomly.
Pair Corralation between Ningbo Jianan and Guangdong Skychem
Assuming the 90 days trading horizon Ningbo Jianan Electronics is expected to under-perform the Guangdong Skychem. But the stock apears to be less risky and, when comparing its historical volatility, Ningbo Jianan Electronics is 1.68 times less risky than Guangdong Skychem. The stock trades about -0.32 of its potential returns per unit of risk. The Guangdong Skychem Technology is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 8,655 in Guangdong Skychem Technology on October 15, 2024 and sell it today you would lose (491.00) from holding Guangdong Skychem Technology or give up 5.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Jianan Electronics vs. Guangdong Skychem Technology
Performance |
| Timeline |
| Ningbo Jianan Electronics |
| Guangdong Skychem |
Ningbo Jianan and Guangdong Skychem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Jianan and Guangdong Skychem
The main advantage of trading using opposite Ningbo Jianan and Guangdong Skychem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Jianan position performs unexpectedly, Guangdong Skychem 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 Guangdong Skychem will offset losses from the drop in Guangdong Skychem's long position.| Ningbo Jianan vs. Uroica Mining Safety | Ningbo Jianan vs. Gifore Agricultural Machinery | Ningbo Jianan vs. SSAW Hotels Resorts | Ningbo Jianan vs. BTG Hotels Group |
| Guangdong Skychem vs. Huayi Brothers Media | Guangdong Skychem vs. Beijing Enlight Media | Guangdong Skychem vs. Thinkingdom Media Group | Guangdong Skychem vs. Yingde Greatchem Chemicals |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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