Correlation Between Ningbo Fangzheng and CIMC Vehicles
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By analyzing existing cross correlation between Ningbo Fangzheng Automobile and CIMC Vehicles Co, you can compare the effects of market volatilities on Ningbo Fangzheng and CIMC Vehicles 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 Fangzheng with a short position of CIMC Vehicles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Fangzheng and CIMC Vehicles.
Diversification Opportunities for Ningbo Fangzheng and CIMC Vehicles
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Ningbo and CIMC is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Fangzheng Automobile and CIMC Vehicles Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIMC Vehicles and Ningbo Fangzheng 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 Fangzheng Automobile are associated (or correlated) with CIMC Vehicles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIMC Vehicles has no effect on the direction of Ningbo Fangzheng i.e., Ningbo Fangzheng and CIMC Vehicles go up and down completely randomly.
Pair Corralation between Ningbo Fangzheng and CIMC Vehicles
Assuming the 90 days trading horizon Ningbo Fangzheng Automobile is expected to under-perform the CIMC Vehicles. In addition to that, Ningbo Fangzheng is 1.67 times more volatile than CIMC Vehicles Co. It trades about -0.04 of its total potential returns per unit of risk. CIMC Vehicles Co is currently generating about -0.05 per unit of volatility. If you would invest 1,006 in CIMC Vehicles Co on August 27, 2024 and sell it today you would lose (26.00) from holding CIMC Vehicles Co or give up 2.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Fangzheng Automobile vs. CIMC Vehicles Co
Performance |
| Timeline |
| Ningbo Fangzheng Aut |
| CIMC Vehicles |
Ningbo Fangzheng and CIMC Vehicles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Fangzheng and CIMC Vehicles
The main advantage of trading using opposite Ningbo Fangzheng and CIMC Vehicles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Fangzheng position performs unexpectedly, CIMC Vehicles 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 CIMC Vehicles will offset losses from the drop in CIMC Vehicles' long position.| Ningbo Fangzheng vs. Loongson Technology Corp | Ningbo Fangzheng vs. Chongqing Road Bridge | Ningbo Fangzheng vs. Shenzhen Fortune Trend | Ningbo Fangzheng vs. Wuhan Xianglong Power |
| CIMC Vehicles vs. Focus Media Information | CIMC Vehicles vs. Chengdu B ray Media | CIMC Vehicles vs. Hengdian Entertainment Co | CIMC Vehicles vs. Oriental Times Media |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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