Correlation Between Ningbo Fangzheng and Anyang Iron
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By analyzing existing cross correlation between Ningbo Fangzheng Automobile and Anyang Iron Steel, you can compare the effects of market volatilities on Ningbo Fangzheng and Anyang Iron 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 Anyang Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Fangzheng and Anyang Iron.
Diversification Opportunities for Ningbo Fangzheng and Anyang Iron
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ningbo and Anyang is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Fangzheng Automobile and Anyang Iron Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anyang Iron Steel 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 Anyang Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anyang Iron Steel has no effect on the direction of Ningbo Fangzheng i.e., Ningbo Fangzheng and Anyang Iron go up and down completely randomly.
Pair Corralation between Ningbo Fangzheng and Anyang Iron
Assuming the 90 days trading horizon Ningbo Fangzheng Automobile is expected to generate 0.87 times more return on investment than Anyang Iron. However, Ningbo Fangzheng Automobile is 1.15 times less risky than Anyang Iron. It trades about -0.18 of its potential returns per unit of risk. Anyang Iron Steel is currently generating about -0.29 per unit of risk. If you would invest 1,738 in Ningbo Fangzheng Automobile on October 17, 2024 and sell it today you would lose (220.00) from holding Ningbo Fangzheng Automobile or give up 12.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ningbo Fangzheng Automobile vs. Anyang Iron Steel
Performance |
| Timeline |
| Ningbo Fangzheng Aut |
| Anyang Iron Steel |
Ningbo Fangzheng and Anyang Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Fangzheng and Anyang Iron
The main advantage of trading using opposite Ningbo Fangzheng and Anyang Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Fangzheng position performs unexpectedly, Anyang Iron 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 Anyang Iron will offset losses from the drop in Anyang Iron's long position.| Ningbo Fangzheng vs. Guangdong Marubi Biotechnology | Ningbo Fangzheng vs. Keeson Technology Corp | Ningbo Fangzheng vs. Eyebright Medical Technology | Ningbo Fangzheng vs. Hubei Forbon Technology |
| Anyang Iron vs. Ningbo Fangzheng Automobile | Anyang Iron vs. Guangxi Wuzhou Communications | Anyang Iron vs. Tangel Publishing | Anyang Iron vs. Shanghai Action Education |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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