Correlation Between Gome Telecom and Ningbo MedicalSystem
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By analyzing existing cross correlation between Gome Telecom Equipment and Ningbo MedicalSystem Biotechnology, you can compare the effects of market volatilities on Gome Telecom and Ningbo MedicalSystem 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 Gome Telecom with a short position of Ningbo MedicalSystem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gome Telecom and Ningbo MedicalSystem.
Diversification Opportunities for Gome Telecom and Ningbo MedicalSystem
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Gome and Ningbo is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Gome Telecom Equipment and Ningbo MedicalSystem Biotechno in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo MedicalSystem and Gome Telecom 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 Gome Telecom Equipment are associated (or correlated) with Ningbo MedicalSystem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo MedicalSystem has no effect on the direction of Gome Telecom i.e., Gome Telecom and Ningbo MedicalSystem go up and down completely randomly.
Pair Corralation between Gome Telecom and Ningbo MedicalSystem
Assuming the 90 days trading horizon Gome Telecom Equipment is expected to under-perform the Ningbo MedicalSystem. In addition to that, Gome Telecom is 1.39 times more volatile than Ningbo MedicalSystem Biotechnology. It trades about -0.01 of its total potential returns per unit of risk. Ningbo MedicalSystem Biotechnology is currently generating about 0.0 per unit of volatility. If you would invest 1,168 in Ningbo MedicalSystem Biotechnology on September 12, 2024 and sell it today you would lose (5.00) from holding Ningbo MedicalSystem Biotechnology or give up 0.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gome Telecom Equipment vs. Ningbo MedicalSystem Biotechno
Performance |
| Timeline |
| Gome Telecom Equipment |
| Ningbo MedicalSystem |
Gome Telecom and Ningbo MedicalSystem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gome Telecom and Ningbo MedicalSystem
The main advantage of trading using opposite Gome Telecom and Ningbo MedicalSystem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gome Telecom position performs unexpectedly, Ningbo MedicalSystem 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 Ningbo MedicalSystem will offset losses from the drop in Ningbo MedicalSystem's long position.| Gome Telecom vs. Lutian Machinery Co | Gome Telecom vs. PetroChina Co Ltd | Gome Telecom vs. Bank of China | Gome Telecom vs. Gansu Jiu Steel |
| Ningbo MedicalSystem vs. Cultural Investment Holdings | Ningbo MedicalSystem vs. Gome Telecom Equipment | Ningbo MedicalSystem vs. Holitech Technology Co | Ningbo MedicalSystem vs. Zotye Automobile Co |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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