Correlation Between Heilongjiang Transport and Nanxing Furniture
Specify exactly 2 symbols:
By analyzing existing cross correlation between Heilongjiang Transport Development and Nanxing Furniture Machinery, you can compare the effects of market volatilities on Heilongjiang Transport and Nanxing Furniture 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 Heilongjiang Transport with a short position of Nanxing Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Transport and Nanxing Furniture.
Diversification Opportunities for Heilongjiang Transport and Nanxing Furniture
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Heilongjiang and Nanxing is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Transport Develop and Nanxing Furniture Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanxing Furniture and Heilongjiang Transport 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 Heilongjiang Transport Development are associated (or correlated) with Nanxing Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanxing Furniture has no effect on the direction of Heilongjiang Transport i.e., Heilongjiang Transport and Nanxing Furniture go up and down completely randomly.
Pair Corralation between Heilongjiang Transport and Nanxing Furniture
Assuming the 90 days trading horizon Heilongjiang Transport Development is expected to under-perform the Nanxing Furniture. But the stock apears to be less risky and, when comparing its historical volatility, Heilongjiang Transport Development is 2.02 times less risky than Nanxing Furniture. The stock trades about -0.16 of its potential returns per unit of risk. The Nanxing Furniture Machinery is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 1,525 in Nanxing Furniture Machinery on October 23, 2024 and sell it today you would lose (102.00) from holding Nanxing Furniture Machinery or give up 6.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heilongjiang Transport Develop vs. Nanxing Furniture Machinery
Performance |
| Timeline |
| Heilongjiang Transport |
| Nanxing Furniture |
Heilongjiang Transport and Nanxing Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Transport and Nanxing Furniture
The main advantage of trading using opposite Heilongjiang Transport and Nanxing Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Transport position performs unexpectedly, Nanxing Furniture 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 Nanxing Furniture will offset losses from the drop in Nanxing Furniture's long position.The idea behind Heilongjiang Transport Development and Nanxing Furniture Machinery pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Nanxing Furniture vs. Suzhou Douson Drilling | Nanxing Furniture vs. Sinocat Environmental Technology | Nanxing Furniture vs. Elite Color Environmental | Nanxing Furniture vs. Hengdian Entertainment 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.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |