Correlation Between Ningbo Fujia and Western Metal
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By analyzing existing cross correlation between Ningbo Fujia Industrial and Western Metal Materials, you can compare the effects of market volatilities on Ningbo Fujia and Western Metal 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 Western Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Fujia and Western Metal.
Diversification Opportunities for Ningbo Fujia and Western Metal
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ningbo and Western is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Fujia Industrial and Western Metal Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Metal Materials 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 Western Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Metal Materials has no effect on the direction of Ningbo Fujia i.e., Ningbo Fujia and Western Metal go up and down completely randomly.
Pair Corralation between Ningbo Fujia and Western Metal
Assuming the 90 days trading horizon Ningbo Fujia is expected to generate 1.72 times less return on investment than Western Metal. In addition to that, Ningbo Fujia is 1.16 times more volatile than Western Metal Materials. It trades about 0.03 of its total potential returns per unit of risk. Western Metal Materials is currently generating about 0.05 per unit of volatility. If you would invest 1,424 in Western Metal Materials on October 12, 2024 and sell it today you would earn a total of 291.00 from holding Western Metal Materials or generate 20.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Fujia Industrial vs. Western Metal Materials
Performance |
| Timeline |
| Ningbo Fujia Industrial |
| Western Metal Materials |
Ningbo Fujia and Western Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Fujia and Western Metal
The main advantage of trading using opposite Ningbo Fujia and Western Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Fujia position performs unexpectedly, Western Metal 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 Western Metal will offset losses from the drop in Western Metal'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 |
| Western Metal vs. Anhui Deli Household | Western Metal vs. Zhangjiagang Freetrade Science | Western Metal vs. Chahua Modern Housewares | Western Metal vs. Tibet Huayu Mining |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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