Correlation Between Ningxia Building and Ningxia Younglight
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By analyzing existing cross correlation between Ningxia Building Materials and Ningxia Younglight Chemicals, you can compare the effects of market volatilities on Ningxia Building and Ningxia Younglight 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 Ningxia Building with a short position of Ningxia Younglight. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningxia Building and Ningxia Younglight.
Diversification Opportunities for Ningxia Building and Ningxia Younglight
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ningxia and Ningxia is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Ningxia Building Materials and Ningxia Younglight Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningxia Younglight and Ningxia Building 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 Ningxia Building Materials are associated (or correlated) with Ningxia Younglight. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningxia Younglight has no effect on the direction of Ningxia Building i.e., Ningxia Building and Ningxia Younglight go up and down completely randomly.
Pair Corralation between Ningxia Building and Ningxia Younglight
Assuming the 90 days trading horizon Ningxia Building Materials is expected to generate 1.06 times more return on investment than Ningxia Younglight. However, Ningxia Building is 1.06 times more volatile than Ningxia Younglight Chemicals. It trades about 0.03 of its potential returns per unit of risk. Ningxia Younglight Chemicals is currently generating about 0.01 per unit of risk. If you would invest 1,223 in Ningxia Building Materials on September 2, 2024 and sell it today you would earn a total of 284.00 from holding Ningxia Building Materials or generate 23.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningxia Building Materials vs. Ningxia Younglight Chemicals
Performance |
| Timeline |
| Ningxia Building Mat |
| Ningxia Younglight |
Ningxia Building and Ningxia Younglight Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningxia Building and Ningxia Younglight
The main advantage of trading using opposite Ningxia Building and Ningxia Younglight positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningxia Building position performs unexpectedly, Ningxia Younglight 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 Ningxia Younglight will offset losses from the drop in Ningxia Younglight's long position.| Ningxia Building vs. China Eastern Airlines | Ningxia Building vs. Peoples Insurance of | Ningxia Building vs. Shandong Mining Machinery | Ningxia Building vs. Sichuan Yahua Industrial |
| Ningxia Younglight vs. Zijin Mining Group | Ningxia Younglight vs. Wanhua Chemical Group | Ningxia Younglight vs. Baoshan Iron Steel | Ningxia Younglight vs. Shandong Gold Mining |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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