Correlation Between Industrial and Nanxing Furniture
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By analyzing existing cross correlation between Industrial and Commercial and Nanxing Furniture Machinery, you can compare the effects of market volatilities on Industrial 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 Industrial with a short position of Nanxing Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Nanxing Furniture.
Diversification Opportunities for Industrial and Nanxing Furniture
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Industrial and Nanxing is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Nanxing Furniture Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanxing Furniture and Industrial 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 Industrial and Commercial 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 Industrial i.e., Industrial and Nanxing Furniture go up and down completely randomly.
Pair Corralation between Industrial and Nanxing Furniture
Assuming the 90 days trading horizon Industrial and Commercial is expected to generate 0.35 times more return on investment than Nanxing Furniture. However, Industrial and Commercial is 2.89 times less risky than Nanxing Furniture. It trades about 0.17 of its potential returns per unit of risk. Nanxing Furniture Machinery is currently generating about 0.0 per unit of risk. If you would invest 607.00 in Industrial and Commercial on October 26, 2024 and sell it today you would earn a total of 59.00 from holding Industrial and Commercial or generate 9.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. Nanxing Furniture Machinery
Performance |
| Timeline |
| Industrial and Commercial |
| Nanxing Furniture |
Industrial and Nanxing Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Nanxing Furniture
The main advantage of trading using opposite Industrial and Nanxing Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial 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.| Industrial vs. Sino Platinum Metals Co | Industrial vs. Offshore Oil Engineering | Industrial vs. Heilongjiang Transport Development | Industrial vs. Qingdao Haier Biomedical |
| Nanxing Furniture vs. PetroChina Co Ltd | Nanxing Furniture vs. Industrial and Commercial | Nanxing Furniture vs. China Petroleum Chemical | Nanxing Furniture vs. China Construction Bank |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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