Correlation Between Ningxia Building and Beijing Quanshi
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By analyzing existing cross correlation between Ningxia Building Materials and Beijing Quanshi World, you can compare the effects of market volatilities on Ningxia Building and Beijing Quanshi 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 Beijing Quanshi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningxia Building and Beijing Quanshi.
Diversification Opportunities for Ningxia Building and Beijing Quanshi
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ningxia and Beijing is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Ningxia Building Materials and Beijing Quanshi World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Quanshi World 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 Beijing Quanshi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Quanshi World has no effect on the direction of Ningxia Building i.e., Ningxia Building and Beijing Quanshi go up and down completely randomly.
Pair Corralation between Ningxia Building and Beijing Quanshi
Assuming the 90 days trading horizon Ningxia Building Materials is expected to generate 0.45 times more return on investment than Beijing Quanshi. However, Ningxia Building Materials is 2.21 times less risky than Beijing Quanshi. It trades about -0.16 of its potential returns per unit of risk. Beijing Quanshi World is currently generating about -0.13 per unit of risk. If you would invest 1,457 in Ningxia Building Materials on November 3, 2024 and sell it today you would lose (97.00) from holding Ningxia Building Materials or give up 6.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningxia Building Materials vs. Beijing Quanshi World
Performance |
| Timeline |
| Ningxia Building Mat |
| Beijing Quanshi World |
Ningxia Building and Beijing Quanshi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningxia Building and Beijing Quanshi
The main advantage of trading using opposite Ningxia Building and Beijing Quanshi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningxia Building position performs unexpectedly, Beijing Quanshi 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 Beijing Quanshi will offset losses from the drop in Beijing Quanshi's long position.| Ningxia Building vs. Allied Machinery Co | Ningxia Building vs. Huasi Agricultural Development | Ningxia Building vs. Ningxia Younglight Chemicals | Ningxia Building vs. Lutian Machinery Co |
| Beijing Quanshi vs. Peoples Insurance of | Beijing Quanshi vs. Ningbo Tech Bank Co | Beijing Quanshi vs. Panda Financial Holding | Beijing Quanshi vs. Shanghai Ziyan Foods |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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