Correlation Between Nanning Chemical and Xiamen Bank
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By analyzing existing cross correlation between Nanning Chemical Industry and Xiamen Bank Co, you can compare the effects of market volatilities on Nanning Chemical and Xiamen Bank 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 Nanning Chemical with a short position of Xiamen Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanning Chemical and Xiamen Bank.
Diversification Opportunities for Nanning Chemical and Xiamen Bank
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nanning and Xiamen is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Nanning Chemical Industry and Xiamen Bank Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Bank and Nanning Chemical 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 Nanning Chemical Industry are associated (or correlated) with Xiamen Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Bank has no effect on the direction of Nanning Chemical i.e., Nanning Chemical and Xiamen Bank go up and down completely randomly.
Pair Corralation between Nanning Chemical and Xiamen Bank
Assuming the 90 days trading horizon Nanning Chemical Industry is expected to generate 2.1 times more return on investment than Xiamen Bank. However, Nanning Chemical is 2.1 times more volatile than Xiamen Bank Co. It trades about 0.08 of its potential returns per unit of risk. Xiamen Bank Co is currently generating about 0.05 per unit of risk. If you would invest 1,060 in Nanning Chemical Industry on October 29, 2024 and sell it today you would earn a total of 702.00 from holding Nanning Chemical Industry or generate 66.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.58% |
| Values | Daily Returns |
Nanning Chemical Industry vs. Xiamen Bank Co
Performance |
| Timeline |
| Nanning Chemical Industry |
| Xiamen Bank |
Nanning Chemical and Xiamen Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanning Chemical and Xiamen Bank
The main advantage of trading using opposite Nanning Chemical and Xiamen Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanning Chemical position performs unexpectedly, Xiamen Bank 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 Xiamen Bank will offset losses from the drop in Xiamen Bank's long position.| Nanning Chemical vs. Yuanjie Semiconductor Technology | Nanning Chemical vs. China Eastern Airlines | Nanning Chemical vs. Hubei Tech Semiconductors | Nanning Chemical vs. Glodon Software Co |
| Xiamen Bank vs. Hunan TV Broadcast | Xiamen Bank vs. Tianshan Aluminum Group | Xiamen Bank vs. Longjian Road Bridge | Xiamen Bank vs. Hubeiyichang Transportation Group |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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