Correlation Between Wuhan Xianglong and Northking Information
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By analyzing existing cross correlation between Wuhan Xianglong Power and Northking Information Technology, you can compare the effects of market volatilities on Wuhan Xianglong and Northking 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 Wuhan Xianglong with a short position of Northking Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuhan Xianglong and Northking Information.
Diversification Opportunities for Wuhan Xianglong and Northking Information
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wuhan and Northking is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Wuhan Xianglong Power and Northking Information Technolo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northking Information and Wuhan Xianglong 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 Wuhan Xianglong Power are associated (or correlated) with Northking Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northking Information has no effect on the direction of Wuhan Xianglong i.e., Wuhan Xianglong and Northking Information go up and down completely randomly.
Pair Corralation between Wuhan Xianglong and Northking Information
Assuming the 90 days trading horizon Wuhan Xianglong Power is expected to generate 1.8 times more return on investment than Northking Information. However, Wuhan Xianglong is 1.8 times more volatile than Northking Information Technology. It trades about 0.08 of its potential returns per unit of risk. Northking Information Technology is currently generating about 0.12 per unit of risk. If you would invest 1,199 in Wuhan Xianglong Power on September 4, 2024 and sell it today you would earn a total of 83.00 from holding Wuhan Xianglong Power or generate 6.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wuhan Xianglong Power vs. Northking Information Technolo
Performance |
| Timeline |
| Wuhan Xianglong Power |
| Northking Information |
Wuhan Xianglong and Northking Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wuhan Xianglong and Northking Information
The main advantage of trading using opposite Wuhan Xianglong and Northking Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuhan Xianglong position performs unexpectedly, Northking 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 Northking Information will offset losses from the drop in Northking Information's long position.| Wuhan Xianglong vs. Hengdian Entertainment Co | Wuhan Xianglong vs. Qingdao Citymedia Co | Wuhan Xianglong vs. Shuhua Sports Co | Wuhan Xianglong vs. Heilongjiang Publishing Media |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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