Correlation Between Ningbo Fangzheng and Bank of Jiangsu Co Ltd
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By analyzing existing cross correlation between Ningbo Fangzheng Automobile and Bank of Jiangsu, you can compare the effects of market volatilities on Ningbo Fangzheng and Bank of Jiangsu Co Ltd 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 Bank of Jiangsu Co Ltd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Fangzheng and Bank of Jiangsu Co Ltd.
Diversification Opportunities for Ningbo Fangzheng and Bank of Jiangsu Co Ltd
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ningbo and Bank is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Fangzheng Automobile and Bank of Jiangsu in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Jiangsu Co Ltd 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 Bank of Jiangsu Co Ltd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Jiangsu Co Ltd has no effect on the direction of Ningbo Fangzheng i.e., Ningbo Fangzheng and Bank of Jiangsu Co Ltd go up and down completely randomly.
Pair Corralation between Ningbo Fangzheng and Bank of Jiangsu Co Ltd
Assuming the 90 days trading horizon Ningbo Fangzheng Automobile is expected to generate 2.14 times more return on investment than Bank of Jiangsu Co Ltd. However, Ningbo Fangzheng is 2.14 times more volatile than Bank of Jiangsu. It trades about 0.11 of its potential returns per unit of risk. Bank of Jiangsu is currently generating about 0.13 per unit of risk. If you would invest 1,303 in Ningbo Fangzheng Automobile on September 2, 2024 and sell it today you would earn a total of 320.00 from holding Ningbo Fangzheng Automobile or generate 24.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Fangzheng Automobile vs. Bank of Jiangsu
Performance |
| Timeline |
| Ningbo Fangzheng Aut |
| Bank of Jiangsu Co Ltd |
Ningbo Fangzheng and Bank of Jiangsu Co Ltd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Fangzheng and Bank of Jiangsu Co Ltd
The main advantage of trading using opposite Ningbo Fangzheng and Bank of Jiangsu Co Ltd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Fangzheng position performs unexpectedly, Bank of Jiangsu Co Ltd 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 Bank of Jiangsu Co Ltd will offset losses from the drop in Bank of Jiangsu Co Ltd's long position.| Ningbo Fangzheng vs. Guangdong Xiongsu Technology | Ningbo Fangzheng vs. Bengang Steel Plates | Ningbo Fangzheng vs. Maxvision Technology Corp | Ningbo Fangzheng vs. Tianshui Huatian Technology |
| Bank of Jiangsu Co Ltd vs. Shanghai Yanpu Metal | Bank of Jiangsu Co Ltd vs. Shengda Mining Co | Bank of Jiangsu Co Ltd vs. Chengtun Mining Group | Bank of Jiangsu Co Ltd vs. Will Semiconductor 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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