Correlation Between Fujian Nanwang and Ningbo Kangqiang
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By analyzing existing cross correlation between Fujian Nanwang Environment and Ningbo Kangqiang Electronics, you can compare the effects of market volatilities on Fujian Nanwang and Ningbo Kangqiang 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 Fujian Nanwang with a short position of Ningbo Kangqiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Nanwang and Ningbo Kangqiang.
Diversification Opportunities for Fujian Nanwang and Ningbo Kangqiang
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fujian and Ningbo is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Nanwang Environment and Ningbo Kangqiang Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Kangqiang Ele and Fujian Nanwang 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 Fujian Nanwang Environment are associated (or correlated) with Ningbo Kangqiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Kangqiang Ele has no effect on the direction of Fujian Nanwang i.e., Fujian Nanwang and Ningbo Kangqiang go up and down completely randomly.
Pair Corralation between Fujian Nanwang and Ningbo Kangqiang
Assuming the 90 days trading horizon Fujian Nanwang Environment is expected to under-perform the Ningbo Kangqiang. But the stock apears to be less risky and, when comparing its historical volatility, Fujian Nanwang Environment is 1.15 times less risky than Ningbo Kangqiang. The stock trades about -0.04 of its potential returns per unit of risk. The Ningbo Kangqiang Electronics is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,290 in Ningbo Kangqiang Electronics on September 2, 2024 and sell it today you would earn a total of 243.00 from holding Ningbo Kangqiang Electronics or generate 18.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 74.9% |
| Values | Daily Returns |
Fujian Nanwang Environment vs. Ningbo Kangqiang Electronics
Performance |
| Timeline |
| Fujian Nanwang Envir |
| Ningbo Kangqiang Ele |
Fujian Nanwang and Ningbo Kangqiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Nanwang and Ningbo Kangqiang
The main advantage of trading using opposite Fujian Nanwang and Ningbo Kangqiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Nanwang position performs unexpectedly, Ningbo Kangqiang 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 Kangqiang will offset losses from the drop in Ningbo Kangqiang's long position.| Fujian Nanwang vs. Zijin Mining Group | Fujian Nanwang vs. Wanhua Chemical Group | Fujian Nanwang vs. Baoshan Iron Steel | Fujian Nanwang vs. Shandong Gold Mining |
| Ningbo Kangqiang vs. Industrial and Commercial | Ningbo Kangqiang vs. Kweichow Moutai Co | Ningbo Kangqiang vs. Agricultural Bank of | Ningbo Kangqiang vs. China Mobile Limited |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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