Correlation Between Ningbo Fangzheng and Shanghai Rightongene
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By analyzing existing cross correlation between Ningbo Fangzheng Automobile and Shanghai Rightongene Biotechnology, you can compare the effects of market volatilities on Ningbo Fangzheng and Shanghai Rightongene 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 Shanghai Rightongene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Fangzheng and Shanghai Rightongene.
Diversification Opportunities for Ningbo Fangzheng and Shanghai Rightongene
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ningbo and Shanghai is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Fangzheng Automobile and Shanghai Rightongene Biotechno in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Rightongene 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 Shanghai Rightongene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Rightongene has no effect on the direction of Ningbo Fangzheng i.e., Ningbo Fangzheng and Shanghai Rightongene go up and down completely randomly.
Pair Corralation between Ningbo Fangzheng and Shanghai Rightongene
Assuming the 90 days trading horizon Ningbo Fangzheng Automobile is expected to under-perform the Shanghai Rightongene. In addition to that, Ningbo Fangzheng is 1.26 times more volatile than Shanghai Rightongene Biotechnology. It trades about -0.02 of its total potential returns per unit of risk. Shanghai Rightongene Biotechnology is currently generating about 0.1 per unit of volatility. If you would invest 1,881 in Shanghai Rightongene Biotechnology on October 30, 2024 and sell it today you would earn a total of 78.00 from holding Shanghai Rightongene Biotechnology or generate 4.15% 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. Shanghai Rightongene Biotechno
Performance |
| Timeline |
| Ningbo Fangzheng Aut |
| Shanghai Rightongene |
Ningbo Fangzheng and Shanghai Rightongene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Fangzheng and Shanghai Rightongene
The main advantage of trading using opposite Ningbo Fangzheng and Shanghai Rightongene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Fangzheng position performs unexpectedly, Shanghai Rightongene 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 Shanghai Rightongene will offset losses from the drop in Shanghai Rightongene's long position.| Ningbo Fangzheng vs. Kweichow Moutai Co | Ningbo Fangzheng vs. Jiangsu Pacific Quartz | Ningbo Fangzheng vs. Shenzhen Transsion Holdings | Ningbo Fangzheng vs. Beijing Roborock Technology |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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