Correlation Between Heilongjiang Transport and Ningbo Tip
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By analyzing existing cross correlation between Heilongjiang Transport Development and Ningbo Tip Rubber, you can compare the effects of market volatilities on Heilongjiang Transport and Ningbo Tip 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 Ningbo Tip. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Transport and Ningbo Tip.
Diversification Opportunities for Heilongjiang Transport and Ningbo Tip
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Heilongjiang and Ningbo is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Transport Develop and Ningbo Tip Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Tip Rubber 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 Ningbo Tip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Tip Rubber has no effect on the direction of Heilongjiang Transport i.e., Heilongjiang Transport and Ningbo Tip go up and down completely randomly.
Pair Corralation between Heilongjiang Transport and Ningbo Tip
Assuming the 90 days trading horizon Heilongjiang Transport Development is expected to under-perform the Ningbo Tip. But the stock apears to be less risky and, when comparing its historical volatility, Heilongjiang Transport Development is 1.47 times less risky than Ningbo Tip. The stock trades about -0.46 of its potential returns per unit of risk. The Ningbo Tip Rubber is currently generating about -0.28 of returns per unit of risk over similar time horizon. If you would invest 1,473 in Ningbo Tip Rubber on October 16, 2024 and sell it today you would lose (281.00) from holding Ningbo Tip Rubber or give up 19.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heilongjiang Transport Develop vs. Ningbo Tip Rubber
Performance |
| Timeline |
| Heilongjiang Transport |
| Ningbo Tip Rubber |
Heilongjiang Transport and Ningbo Tip Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Transport and Ningbo Tip
The main advantage of trading using opposite Heilongjiang Transport and Ningbo Tip positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Transport position performs unexpectedly, Ningbo Tip 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 Tip will offset losses from the drop in Ningbo Tip's long position.| Heilongjiang Transport vs. Winner Medical Co | Heilongjiang Transport vs. Ningxia Younglight Chemicals | Heilongjiang Transport vs. Cowealth Medical China | Heilongjiang Transport vs. Jahen Household Products |
| Ningbo Tip vs. Hefei Metalforming Mach | Ningbo Tip vs. Aluminum Corp of | Ningbo Tip vs. Zhejiang Yongjin Metal | Ningbo Tip vs. Heilongjiang Transport Development |
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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