Correlation Between Northern United and Weihai Guangwei
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By analyzing existing cross correlation between Northern United Publishing and Weihai Guangwei Composites, you can compare the effects of market volatilities on Northern United and Weihai Guangwei 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 Northern United with a short position of Weihai Guangwei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northern United and Weihai Guangwei.
Diversification Opportunities for Northern United and Weihai Guangwei
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Northern and Weihai is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Northern United Publishing and Weihai Guangwei Composites in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weihai Guangwei Comp and Northern United 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 Northern United Publishing are associated (or correlated) with Weihai Guangwei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weihai Guangwei Comp has no effect on the direction of Northern United i.e., Northern United and Weihai Guangwei go up and down completely randomly.
Pair Corralation between Northern United and Weihai Guangwei
Assuming the 90 days trading horizon Northern United Publishing is expected to generate 0.77 times more return on investment than Weihai Guangwei. However, Northern United Publishing is 1.3 times less risky than Weihai Guangwei. It trades about 0.14 of its potential returns per unit of risk. Weihai Guangwei Composites is currently generating about 0.0 per unit of risk. If you would invest 646.00 in Northern United Publishing on September 1, 2024 and sell it today you would earn a total of 49.00 from holding Northern United Publishing or generate 7.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Northern United Publishing vs. Weihai Guangwei Composites
Performance |
| Timeline |
| Northern United Publ |
| Weihai Guangwei Comp |
Northern United and Weihai Guangwei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Northern United and Weihai Guangwei
The main advantage of trading using opposite Northern United and Weihai Guangwei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northern United position performs unexpectedly, Weihai Guangwei 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 Weihai Guangwei will offset losses from the drop in Weihai Guangwei's long position.| Northern United vs. Cambricon Technologies Corp | Northern United vs. Loongson Technology Corp | Northern United vs. Shenzhen Fortune Trend | Northern United vs. Chongqing Road Bridge |
| Weihai Guangwei vs. Xizi Clean Energy | Weihai Guangwei vs. Northern United Publishing | Weihai Guangwei vs. Keda Clean Energy | Weihai Guangwei vs. Beijing HuaYuanYiTong Thermal |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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