Correlation Between Fujian Nanwang and Eit Environmental
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By analyzing existing cross correlation between Fujian Nanwang Environment and Eit Environmental Development, you can compare the effects of market volatilities on Fujian Nanwang and Eit Environmental 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 Eit Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Nanwang and Eit Environmental.
Diversification Opportunities for Fujian Nanwang and Eit Environmental
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fujian and Eit is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Nanwang Environment and Eit Environmental Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eit Environmental 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 Eit Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eit Environmental has no effect on the direction of Fujian Nanwang i.e., Fujian Nanwang and Eit Environmental go up and down completely randomly.
Pair Corralation between Fujian Nanwang and Eit Environmental
Assuming the 90 days trading horizon Fujian Nanwang Environment is expected to under-perform the Eit Environmental. In addition to that, Fujian Nanwang is 1.04 times more volatile than Eit Environmental Development. It trades about -0.04 of its total potential returns per unit of risk. Eit Environmental Development is currently generating about 0.03 per unit of volatility. If you would invest 1,269 in Eit Environmental Development on August 30, 2024 and sell it today you would earn a total of 279.00 from holding Eit Environmental Development or generate 21.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 74.58% |
| Values | Daily Returns |
Fujian Nanwang Environment vs. Eit Environmental Development
Performance |
| Timeline |
| Fujian Nanwang Envir |
| Eit Environmental |
Fujian Nanwang and Eit Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Nanwang and Eit Environmental
The main advantage of trading using opposite Fujian Nanwang and Eit Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Nanwang position performs unexpectedly, Eit Environmental 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 Eit Environmental will offset losses from the drop in Eit Environmental's long position.| Fujian Nanwang vs. Shandong Gold Mining | Fujian Nanwang vs. Rongsheng Petrochemical Co | Fujian Nanwang vs. Inner Mongolia BaoTou | Fujian Nanwang vs. Jiangxi Ganfeng Lithium |
| Eit Environmental vs. PetroChina Co Ltd | Eit Environmental vs. China State Construction | Eit Environmental vs. China Mobile Limited | Eit Environmental vs. Industrial and Commercial |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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