Correlation Between Thinkingdom Media and Ningbo Ligong
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By analyzing existing cross correlation between Thinkingdom Media Group and Ningbo Ligong Online, you can compare the effects of market volatilities on Thinkingdom Media and Ningbo Ligong 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 Thinkingdom Media with a short position of Ningbo Ligong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thinkingdom Media and Ningbo Ligong.
Diversification Opportunities for Thinkingdom Media and Ningbo Ligong
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Thinkingdom and Ningbo is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Thinkingdom Media Group and Ningbo Ligong Online in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Ligong Online and Thinkingdom Media 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 Thinkingdom Media Group are associated (or correlated) with Ningbo Ligong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Ligong Online has no effect on the direction of Thinkingdom Media i.e., Thinkingdom Media and Ningbo Ligong go up and down completely randomly.
Pair Corralation between Thinkingdom Media and Ningbo Ligong
Assuming the 90 days trading horizon Thinkingdom Media Group is expected to under-perform the Ningbo Ligong. But the stock apears to be less risky and, when comparing its historical volatility, Thinkingdom Media Group is 1.02 times less risky than Ningbo Ligong. The stock trades about -0.11 of its potential returns per unit of risk. The Ningbo Ligong Online is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,194 in Ningbo Ligong Online on November 7, 2024 and sell it today you would earn a total of 107.00 from holding Ningbo Ligong Online or generate 8.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thinkingdom Media Group vs. Ningbo Ligong Online
Performance |
| Timeline |
| Thinkingdom Media |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
| Ningbo Ligong Online |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Thinkingdom Media and Ningbo Ligong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thinkingdom Media and Ningbo Ligong
The main advantage of trading using opposite Thinkingdom Media and Ningbo Ligong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thinkingdom Media position performs unexpectedly, Ningbo Ligong 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 Ligong will offset losses from the drop in Ningbo Ligong's long position.The idea behind Thinkingdom Media Group and Ningbo Ligong Online pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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