Correlation Between Ningbo Homelink and Ningbo Fujia
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By analyzing existing cross correlation between Ningbo Homelink Eco iTech and Ningbo Fujia Industrial, you can compare the effects of market volatilities on Ningbo Homelink and Ningbo Fujia 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 Homelink with a short position of Ningbo Fujia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Homelink and Ningbo Fujia.
Diversification Opportunities for Ningbo Homelink and Ningbo Fujia
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ningbo and Ningbo is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Homelink Eco iTech and Ningbo Fujia Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Fujia Industrial and Ningbo Homelink 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 Homelink Eco iTech are associated (or correlated) with Ningbo Fujia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Fujia Industrial has no effect on the direction of Ningbo Homelink i.e., Ningbo Homelink and Ningbo Fujia go up and down completely randomly.
Pair Corralation between Ningbo Homelink and Ningbo Fujia
Assuming the 90 days trading horizon Ningbo Homelink is expected to generate 6.74 times less return on investment than Ningbo Fujia. But when comparing it to its historical volatility, Ningbo Homelink Eco iTech is 1.27 times less risky than Ningbo Fujia. It trades about 0.01 of its potential returns per unit of risk. Ningbo Fujia Industrial is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,340 in Ningbo Fujia Industrial on October 14, 2024 and sell it today you would earn a total of 37.00 from holding Ningbo Fujia Industrial or generate 2.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Homelink Eco iTech vs. Ningbo Fujia Industrial
Performance |
| Timeline |
| Ningbo Homelink Eco |
| Ningbo Fujia Industrial |
Ningbo Homelink and Ningbo Fujia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Homelink and Ningbo Fujia
The main advantage of trading using opposite Ningbo Homelink and Ningbo Fujia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Homelink position performs unexpectedly, Ningbo Fujia 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 Fujia will offset losses from the drop in Ningbo Fujia's long position.| Ningbo Homelink vs. Anhui Jianghuai Automobile | Ningbo Homelink vs. TongFu Microelectronics Co | Ningbo Homelink vs. Shenzhen Clou Electronics | Ningbo Homelink vs. Fiberhome Telecommunication Technologies |
| Ningbo Fujia vs. Shuhua Sports Co | Ningbo Fujia vs. Ningbo Homelink Eco iTech | Ningbo Fujia vs. Hunan Mendale Hometextile | Ningbo Fujia vs. Shandong Homey Aquatic |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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