Correlation Between Ningbo Fangzheng and Ningbo Homelink
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By analyzing existing cross correlation between Ningbo Fangzheng Automobile and Ningbo Homelink Eco iTech, you can compare the effects of market volatilities on Ningbo Fangzheng and Ningbo Homelink 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 Ningbo Homelink. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Fangzheng and Ningbo Homelink.
Diversification Opportunities for Ningbo Fangzheng and Ningbo Homelink
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Ningbo and Ningbo is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Fangzheng Automobile and Ningbo Homelink Eco iTech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Homelink Eco 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 Ningbo Homelink. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Homelink Eco has no effect on the direction of Ningbo Fangzheng i.e., Ningbo Fangzheng and Ningbo Homelink go up and down completely randomly.
Pair Corralation between Ningbo Fangzheng and Ningbo Homelink
Assuming the 90 days trading horizon Ningbo Fangzheng Automobile is expected to generate 1.26 times more return on investment than Ningbo Homelink. However, Ningbo Fangzheng is 1.26 times more volatile than Ningbo Homelink Eco iTech. It trades about 0.13 of its potential returns per unit of risk. Ningbo Homelink Eco iTech is currently generating about 0.0 per unit of risk. If you would invest 1,638 in Ningbo Fangzheng Automobile on September 12, 2024 and sell it today you would earn a total of 130.00 from holding Ningbo Fangzheng Automobile or generate 7.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Fangzheng Automobile vs. Ningbo Homelink Eco iTech
Performance |
| Timeline |
| Ningbo Fangzheng Aut |
| Ningbo Homelink Eco |
Ningbo Fangzheng and Ningbo Homelink Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Fangzheng and Ningbo Homelink
The main advantage of trading using opposite Ningbo Fangzheng and Ningbo Homelink positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Fangzheng position performs unexpectedly, Ningbo Homelink 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 Ningbo Homelink will offset losses from the drop in Ningbo Homelink's long position.| Ningbo Fangzheng vs. Lutian Machinery Co | Ningbo Fangzheng vs. PetroChina Co Ltd | Ningbo Fangzheng vs. Bank of China | Ningbo Fangzheng vs. Gansu Jiu Steel |
| Ningbo Homelink vs. Zijin Mining Group | Ningbo Homelink vs. Wanhua Chemical Group | Ningbo Homelink vs. Baoshan Iron Steel | Ningbo Homelink vs. Rongsheng Petrochemical 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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