Correlation Between Nantong Haixing and Aurora Optoelectronics
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By analyzing existing cross correlation between Nantong Haixing Electronics and Aurora Optoelectronics Co, you can compare the effects of market volatilities on Nantong Haixing and Aurora Optoelectronics 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 Nantong Haixing with a short position of Aurora Optoelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nantong Haixing and Aurora Optoelectronics.
Diversification Opportunities for Nantong Haixing and Aurora Optoelectronics
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nantong and Aurora is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Nantong Haixing Electronics and Aurora Optoelectronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Optoelectronics and Nantong Haixing 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 Nantong Haixing Electronics are associated (or correlated) with Aurora Optoelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Optoelectronics has no effect on the direction of Nantong Haixing i.e., Nantong Haixing and Aurora Optoelectronics go up and down completely randomly.
Pair Corralation between Nantong Haixing and Aurora Optoelectronics
Assuming the 90 days trading horizon Nantong Haixing is expected to generate 3.85 times less return on investment than Aurora Optoelectronics. But when comparing it to its historical volatility, Nantong Haixing Electronics is 1.67 times less risky than Aurora Optoelectronics. It trades about 0.2 of its potential returns per unit of risk. Aurora Optoelectronics Co is currently generating about 0.47 of returns per unit of risk over similar time horizon. If you would invest 214.00 in Aurora Optoelectronics Co on November 28, 2024 and sell it today you would earn a total of 90.00 from holding Aurora Optoelectronics Co or generate 42.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nantong Haixing Electronics vs. Aurora Optoelectronics Co
Performance |
| Timeline |
| Nantong Haixing Elec |
| Aurora Optoelectronics |
Nantong Haixing and Aurora Optoelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nantong Haixing and Aurora Optoelectronics
The main advantage of trading using opposite Nantong Haixing and Aurora Optoelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nantong Haixing position performs unexpectedly, Aurora Optoelectronics 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 Aurora Optoelectronics will offset losses from the drop in Aurora Optoelectronics' long position.| Nantong Haixing vs. Guangzhou Seagull Kitchen | Nantong Haixing vs. Zhongyin Babi Food | Nantong Haixing vs. Ligao Foods CoLtd | Nantong Haixing vs. Elite Color Environmental |
| Aurora Optoelectronics vs. Beijing Sanyuan Foods | Aurora Optoelectronics vs. Shanghai Ziyan Foods | Aurora Optoelectronics vs. Huaibei Mining Holdings | Aurora Optoelectronics vs. HaiXin Foods Co |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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