Correlation Between China National and Contec Medical
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By analyzing existing cross correlation between China National Software and Contec Medical Systems, you can compare the effects of market volatilities on China National and Contec Medical 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 China National with a short position of Contec Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of China National and Contec Medical.
Diversification Opportunities for China National and Contec Medical
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Contec is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding China National Software and Contec Medical Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Contec Medical Systems and China National 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 China National Software are associated (or correlated) with Contec Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Contec Medical Systems has no effect on the direction of China National i.e., China National and Contec Medical go up and down completely randomly.
Pair Corralation between China National and Contec Medical
Assuming the 90 days trading horizon China National Software is expected to generate 1.52 times more return on investment than Contec Medical. However, China National is 1.52 times more volatile than Contec Medical Systems. It trades about -0.01 of its potential returns per unit of risk. Contec Medical Systems is currently generating about -0.04 per unit of risk. If you would invest 5,320 in China National Software on November 18, 2024 and sell it today you would lose (203.00) from holding China National Software or give up 3.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China National Software vs. Contec Medical Systems
Performance |
| Timeline |
| China National Software |
| Contec Medical Systems |
China National and Contec Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China National and Contec Medical
The main advantage of trading using opposite China National and Contec Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China National position performs unexpectedly, Contec Medical 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 Contec Medical will offset losses from the drop in Contec Medical's long position.| China National vs. Guangdong TianYiMa Information | China National vs. Xinjiang Tianrun Dairy | China National vs. Nsfocus Information Technology | China National vs. Northking Information Technology |
| Contec Medical vs. Advanced Technology Materials | Contec Medical vs. NBTM New Materials | Contec Medical vs. Malion New Materials | Contec Medical vs. Super Dragon Engineering Plastics |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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