Correlation Between New China and Ningxia Xiaoming
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By analyzing existing cross correlation between New China Life and Ningxia Xiaoming Agriculture, you can compare the effects of market volatilities on New China and Ningxia Xiaoming 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 New China with a short position of Ningxia Xiaoming. Check out your portfolio center. Please also check ongoing floating volatility patterns of New China and Ningxia Xiaoming.
Diversification Opportunities for New China and Ningxia Xiaoming
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between New and Ningxia is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding New China Life and Ningxia Xiaoming Agriculture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningxia Xiaoming Agr and New China 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 New China Life are associated (or correlated) with Ningxia Xiaoming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningxia Xiaoming Agr has no effect on the direction of New China i.e., New China and Ningxia Xiaoming go up and down completely randomly.
Pair Corralation between New China and Ningxia Xiaoming
Assuming the 90 days trading horizon New China Life is expected to generate 0.71 times more return on investment than Ningxia Xiaoming. However, New China Life is 1.4 times less risky than Ningxia Xiaoming. It trades about 0.07 of its potential returns per unit of risk. Ningxia Xiaoming Agriculture is currently generating about 0.0 per unit of risk. If you would invest 2,782 in New China Life on September 13, 2024 and sell it today you would earn a total of 2,386 from holding New China Life or generate 85.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
New China Life vs. Ningxia Xiaoming Agriculture
Performance |
| Timeline |
| New China Life |
| Ningxia Xiaoming Agr |
New China and Ningxia Xiaoming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New China and Ningxia Xiaoming
The main advantage of trading using opposite New China and Ningxia Xiaoming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New China position performs unexpectedly, Ningxia Xiaoming 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 Ningxia Xiaoming will offset losses from the drop in Ningxia Xiaoming's long position.| New China vs. Jointo Energy Investment | New China vs. Tonghua Grape Wine | New China vs. Citic Guoan Wine | New China vs. Keda Clean Energy |
| Ningxia Xiaoming vs. New China Life | Ningxia Xiaoming vs. Ming Yang Smart | Ningxia Xiaoming vs. 159681 | Ningxia Xiaoming vs. 159005 |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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