Correlation Between Senci Electric and Nanxing Furniture
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By analyzing existing cross correlation between Senci Electric Machinery and Nanxing Furniture Machinery, you can compare the effects of market volatilities on Senci Electric 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 Senci Electric with a short position of Nanxing Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Senci Electric and Nanxing Furniture.
Diversification Opportunities for Senci Electric and Nanxing Furniture
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Senci and Nanxing is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Senci Electric Machinery and Nanxing Furniture Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanxing Furniture and Senci Electric 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 Senci Electric Machinery 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 Senci Electric i.e., Senci Electric and Nanxing Furniture go up and down completely randomly.
Pair Corralation between Senci Electric and Nanxing Furniture
Assuming the 90 days trading horizon Senci Electric Machinery is expected to generate 1.14 times more return on investment than Nanxing Furniture. However, Senci Electric is 1.14 times more volatile than Nanxing Furniture Machinery. It trades about 0.04 of its potential returns per unit of risk. Nanxing Furniture Machinery is currently generating about -0.15 per unit of risk. If you would invest 1,680 in Senci Electric Machinery on October 15, 2024 and sell it today you would earn a total of 30.00 from holding Senci Electric Machinery or generate 1.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Senci Electric Machinery vs. Nanxing Furniture Machinery
Performance |
| Timeline |
| Senci Electric Machinery |
| Nanxing Furniture |
Senci Electric and Nanxing Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Senci Electric and Nanxing Furniture
The main advantage of trading using opposite Senci Electric and Nanxing Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Senci Electric 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.| Senci Electric vs. Cloud Live Technology | Senci Electric vs. Nanjing Putian Telecommunications | Senci Electric vs. Tianjin Realty Development | Senci Electric vs. Shenzhen Coship Electronics |
| Nanxing Furniture vs. Changjiang Publishing Media | Nanxing Furniture vs. Xinhua Winshare Publishing | Nanxing Furniture vs. Beijing Kaiwen Education | Nanxing Furniture vs. BTG Hotels Group |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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