Correlation Between Ningxia Building and Westone Information
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By analyzing existing cross correlation between Ningxia Building Materials and Westone Information Industry, you can compare the effects of market volatilities on Ningxia Building and Westone Information 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 Westone Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningxia Building and Westone Information.
Diversification Opportunities for Ningxia Building and Westone Information
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ningxia and Westone is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Ningxia Building Materials and Westone Information Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westone Information 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 Westone Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westone Information has no effect on the direction of Ningxia Building i.e., Ningxia Building and Westone Information go up and down completely randomly.
Pair Corralation between Ningxia Building and Westone Information
Assuming the 90 days trading horizon Ningxia Building Materials is expected to generate 1.18 times more return on investment than Westone Information. However, Ningxia Building is 1.18 times more volatile than Westone Information Industry. It trades about 0.02 of its potential returns per unit of risk. Westone Information Industry is currently generating about -0.05 per unit of risk. If you would invest 1,184 in Ningxia Building Materials on October 16, 2024 and sell it today you would earn a total of 83.00 from holding Ningxia Building Materials or generate 7.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningxia Building Materials vs. Westone Information Industry
Performance |
| Timeline |
| Ningxia Building Mat |
| Westone Information |
Ningxia Building and Westone Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningxia Building and Westone Information
The main advantage of trading using opposite Ningxia Building and Westone Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningxia Building position performs unexpectedly, Westone Information 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 Westone Information will offset losses from the drop in Westone Information's long position.| Ningxia Building vs. China Asset Management | Ningxia Building vs. Beijing Mainstreets Investment | Ningxia Building vs. Xiandai Investment Co | Ningxia Building vs. Bus Online Co |
| Westone Information vs. Ningxia Building Materials | Westone Information vs. Shuhua Sports Co | Westone Information vs. Zhejiang HISUN Biomaterials | Westone Information vs. Shanghai Yaoji Playing |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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