Correlation Between Ningbo Construction and Hua Xia
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By analyzing existing cross correlation between Ningbo Construction Co and Hua Xia Bank, you can compare the effects of market volatilities on Ningbo Construction and Hua Xia 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 Ningbo Construction with a short position of Hua Xia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Construction and Hua Xia.
Diversification Opportunities for Ningbo Construction and Hua Xia
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ningbo and Hua is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Construction Co and Hua Xia Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hua Xia Bank and Ningbo Construction 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 Ningbo Construction Co are associated (or correlated) with Hua Xia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hua Xia Bank has no effect on the direction of Ningbo Construction i.e., Ningbo Construction and Hua Xia go up and down completely randomly.
Pair Corralation between Ningbo Construction and Hua Xia
Assuming the 90 days trading horizon Ningbo Construction Co is expected to under-perform the Hua Xia. In addition to that, Ningbo Construction is 2.74 times more volatile than Hua Xia Bank. It trades about -0.23 of its total potential returns per unit of risk. Hua Xia Bank is currently generating about -0.08 per unit of volatility. If you would invest 772.00 in Hua Xia Bank on October 12, 2024 and sell it today you would lose (16.00) from holding Hua Xia Bank or give up 2.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Construction Co vs. Hua Xia Bank
Performance |
| Timeline |
| Ningbo Construction |
| Hua Xia Bank |
Ningbo Construction and Hua Xia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Construction and Hua Xia
The main advantage of trading using opposite Ningbo Construction and Hua Xia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Construction position performs unexpectedly, Hua Xia 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 Hua Xia will offset losses from the drop in Hua Xia's long position.| Ningbo Construction vs. ChengDu Hi Tech Development | Ningbo Construction vs. Western Metal Materials | Ningbo Construction vs. Unisplendour Corp | Ningbo Construction vs. Hengli Industrial Development |
| Hua Xia vs. Bohai Leasing Co | Hua Xia vs. Easyhome New Retail | Hua Xia vs. Ningbo Construction Co | Hua Xia vs. Sinomach General Machinery |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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