Correlation Between Western Mining and Nanjing Putian
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By analyzing existing cross correlation between Western Mining Co and Nanjing Putian Telecommunications, you can compare the effects of market volatilities on Western Mining and Nanjing Putian 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 Western Mining with a short position of Nanjing Putian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Mining and Nanjing Putian.
Diversification Opportunities for Western Mining and Nanjing Putian
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Western and Nanjing is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Western Mining Co and Nanjing Putian Telecommunicati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanjing Putian Telec and Western Mining 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 Western Mining Co are associated (or correlated) with Nanjing Putian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanjing Putian Telec has no effect on the direction of Western Mining i.e., Western Mining and Nanjing Putian go up and down completely randomly.
Pair Corralation between Western Mining and Nanjing Putian
Assuming the 90 days trading horizon Western Mining Co is expected to under-perform the Nanjing Putian. But the stock apears to be less risky and, when comparing its historical volatility, Western Mining Co is 2.41 times less risky than Nanjing Putian. The stock trades about -0.21 of its potential returns per unit of risk. The Nanjing Putian Telecommunications is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 390.00 in Nanjing Putian Telecommunications on September 2, 2024 and sell it today you would earn a total of 70.00 from holding Nanjing Putian Telecommunications or generate 17.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Mining Co vs. Nanjing Putian Telecommunicati
Performance |
| Timeline |
| Western Mining |
| Nanjing Putian Telec |
Western Mining and Nanjing Putian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Mining and Nanjing Putian
The main advantage of trading using opposite Western Mining and Nanjing Putian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Mining position performs unexpectedly, Nanjing Putian 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 Nanjing Putian will offset losses from the drop in Nanjing Putian's long position.| Western Mining vs. Cultural Investment Holdings | Western Mining vs. JCHX Mining Management | Western Mining vs. Zoje Resources Investment | Western Mining vs. Zhejiang Construction Investment |
| Nanjing Putian vs. Puyang Huicheng Electronic | Nanjing Putian vs. Jiangyin Jianghua Microelectronics | Nanjing Putian vs. Qumei Furniture Group | Nanjing Putian vs. Fiberhome Telecommunication Technologies |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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