Correlation Between Ningbo Fangzheng and China Construction
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By analyzing existing cross correlation between Ningbo Fangzheng Automobile and China Construction Bank, you can compare the effects of market volatilities on Ningbo Fangzheng and China Construction 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 China Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Fangzheng and China Construction.
Diversification Opportunities for Ningbo Fangzheng and China Construction
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ningbo and China is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Fangzheng Automobile and China Construction Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Construction Bank 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 China Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Construction Bank has no effect on the direction of Ningbo Fangzheng i.e., Ningbo Fangzheng and China Construction go up and down completely randomly.
Pair Corralation between Ningbo Fangzheng and China Construction
Assuming the 90 days trading horizon Ningbo Fangzheng Automobile is expected to generate 2.35 times more return on investment than China Construction. However, Ningbo Fangzheng is 2.35 times more volatile than China Construction Bank. It trades about 0.03 of its potential returns per unit of risk. China Construction Bank is currently generating about 0.07 per unit of risk. If you would invest 1,361 in Ningbo Fangzheng Automobile on October 26, 2024 and sell it today you would earn a total of 74.00 from holding Ningbo Fangzheng Automobile or generate 5.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Fangzheng Automobile vs. China Construction Bank
Performance |
| Timeline |
| Ningbo Fangzheng Aut |
| China Construction Bank |
Ningbo Fangzheng and China Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Fangzheng and China Construction
The main advantage of trading using opposite Ningbo Fangzheng and China Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Fangzheng position performs unexpectedly, China Construction 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 China Construction will offset losses from the drop in China Construction's long position.| Ningbo Fangzheng vs. Zoje Resources Investment | Ningbo Fangzheng vs. Emdoor Information Co | Ningbo Fangzheng vs. Zhejiang Construction Investment | Ningbo Fangzheng vs. Xiandai Investment 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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