Correlation Between Ningbo Fujia and Hengli Industrial
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By analyzing existing cross correlation between Ningbo Fujia Industrial and Hengli Industrial Development, you can compare the effects of market volatilities on Ningbo Fujia and Hengli Industrial 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 Fujia with a short position of Hengli Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Fujia and Hengli Industrial.
Diversification Opportunities for Ningbo Fujia and Hengli Industrial
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ningbo and Hengli is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Fujia Industrial and Hengli Industrial Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hengli Industrial and Ningbo Fujia 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 Fujia Industrial are associated (or correlated) with Hengli Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hengli Industrial has no effect on the direction of Ningbo Fujia i.e., Ningbo Fujia and Hengli Industrial go up and down completely randomly.
Pair Corralation between Ningbo Fujia and Hengli Industrial
Assuming the 90 days trading horizon Ningbo Fujia Industrial is expected to generate 0.86 times more return on investment than Hengli Industrial. However, Ningbo Fujia Industrial is 1.16 times less risky than Hengli Industrial. It trades about 0.03 of its potential returns per unit of risk. Hengli Industrial Development is currently generating about -0.03 per unit of risk. If you would invest 1,372 in Ningbo Fujia Industrial on October 12, 2024 and sell it today you would earn a total of 76.00 from holding Ningbo Fujia Industrial or generate 5.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Fujia Industrial vs. Hengli Industrial Development
Performance |
| Timeline |
| Ningbo Fujia Industrial |
| Hengli Industrial |
Ningbo Fujia and Hengli Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Fujia and Hengli Industrial
The main advantage of trading using opposite Ningbo Fujia and Hengli Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Fujia position performs unexpectedly, Hengli Industrial 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 Hengli Industrial will offset losses from the drop in Hengli Industrial's long position.| Ningbo Fujia vs. Hubeiyichang Transportation Group | Ningbo Fujia vs. Fujian Longzhou Transportation | Ningbo Fujia vs. China Minmetals Rare | Ningbo Fujia vs. Hengli Industrial Development |
| Hengli Industrial vs. Tsingtao Brewery Co | Hengli Industrial vs. Dawning Information Industry | Hengli Industrial vs. Wuhan Yangtze Communication | Hengli Industrial vs. Unisplendour Corp |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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