Correlation Between Ningbo Homelink and Shanghai Shuixing
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By analyzing existing cross correlation between Ningbo Homelink Eco iTech and Shanghai Shuixing Home, you can compare the effects of market volatilities on Ningbo Homelink and Shanghai Shuixing 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 Shanghai Shuixing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Homelink and Shanghai Shuixing.
Diversification Opportunities for Ningbo Homelink and Shanghai Shuixing
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ningbo and Shanghai is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Homelink Eco iTech and Shanghai Shuixing Home in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Shuixing Home 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 Shanghai Shuixing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Shuixing Home has no effect on the direction of Ningbo Homelink i.e., Ningbo Homelink and Shanghai Shuixing go up and down completely randomly.
Pair Corralation between Ningbo Homelink and Shanghai Shuixing
Assuming the 90 days trading horizon Ningbo Homelink Eco iTech is expected to under-perform the Shanghai Shuixing. In addition to that, Ningbo Homelink is 1.22 times more volatile than Shanghai Shuixing Home. It trades about -0.01 of its total potential returns per unit of risk. Shanghai Shuixing Home is currently generating about 0.02 per unit of volatility. If you would invest 1,319 in Shanghai Shuixing Home on October 27, 2024 and sell it today you would earn a total of 183.00 from holding Shanghai Shuixing Home or generate 13.87% 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. Shanghai Shuixing Home
Performance |
| Timeline |
| Ningbo Homelink Eco |
| Shanghai Shuixing Home |
Ningbo Homelink and Shanghai Shuixing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Homelink and Shanghai Shuixing
The main advantage of trading using opposite Ningbo Homelink and Shanghai Shuixing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Homelink position performs unexpectedly, Shanghai Shuixing 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 Shuixing will offset losses from the drop in Shanghai Shuixing's long position.| Ningbo Homelink vs. Nanxing Furniture Machinery | Ningbo Homelink vs. Great Sun Foods Co | Ningbo Homelink vs. Anhui Huilong Agricultural | Ningbo Homelink vs. Linzhou Heavy Machinery |
| Shanghai Shuixing vs. Sportsoul Co Ltd | Shanghai Shuixing vs. Keda Clean Energy | Shanghai Shuixing vs. Luyin Investment Group | Shanghai Shuixing 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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