Correlation Between Panda Dairy and Nanjing Putian
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By analyzing existing cross correlation between Panda Dairy Corp and Nanjing Putian Telecommunications, you can compare the effects of market volatilities on Panda Dairy and Nanjing Putian 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 Panda Dairy with a short position of Nanjing Putian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Panda Dairy and Nanjing Putian.
Diversification Opportunities for Panda Dairy and Nanjing Putian
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Panda and Nanjing is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Panda Dairy Corp and Nanjing Putian Telecommunicati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanjing Putian Telec and Panda Dairy 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 Panda Dairy Corp are associated (or correlated) with Nanjing Putian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanjing Putian Telec has no effect on the direction of Panda Dairy i.e., Panda Dairy and Nanjing Putian go up and down completely randomly.
Pair Corralation between Panda Dairy and Nanjing Putian
Assuming the 90 days trading horizon Panda Dairy is expected to generate 3.64 times less return on investment than Nanjing Putian. But when comparing it to its historical volatility, Panda Dairy Corp is 1.47 times less risky than Nanjing Putian. It trades about 0.09 of its potential returns per unit of risk. Nanjing Putian Telecommunications is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 154.00 in Nanjing Putian Telecommunications on September 3, 2024 and sell it today you would earn a total of 306.00 from holding Nanjing Putian Telecommunications or generate 198.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Panda Dairy Corp vs. Nanjing Putian Telecommunicati
Performance |
| Timeline |
| Panda Dairy Corp |
| Nanjing Putian Telec |
Panda Dairy and Nanjing Putian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Panda Dairy and Nanjing Putian
The main advantage of trading using opposite Panda Dairy and Nanjing Putian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Panda Dairy position performs unexpectedly, Nanjing Putian 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 Nanjing Putian will offset losses from the drop in Nanjing Putian's long position.| Panda Dairy vs. Beijing Wantai Biological | Panda Dairy vs. Aluminum Corp of | Panda Dairy vs. COL Digital Publishing | Panda Dairy vs. Shaanxi Meineng Clean |
| Nanjing Putian vs. Agricultural Bank of | Nanjing Putian vs. China Construction Bank | Nanjing Putian vs. Postal Savings Bank | Nanjing Putian vs. Bank of Communications |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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