Correlation Between Nanjing OLO and Long Yuan
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By analyzing existing cross correlation between Nanjing OLO Home and Long Yuan Construction, you can compare the effects of market volatilities on Nanjing OLO and Long Yuan 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 Nanjing OLO with a short position of Long Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing OLO and Long Yuan.
Diversification Opportunities for Nanjing OLO and Long Yuan
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nanjing and Long is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing OLO Home and Long Yuan Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Long Yuan Construction and Nanjing OLO 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 Nanjing OLO Home are associated (or correlated) with Long Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Long Yuan Construction has no effect on the direction of Nanjing OLO i.e., Nanjing OLO and Long Yuan go up and down completely randomly.
Pair Corralation between Nanjing OLO and Long Yuan
Assuming the 90 days trading horizon Nanjing OLO Home is expected to generate 1.06 times more return on investment than Long Yuan. However, Nanjing OLO is 1.06 times more volatile than Long Yuan Construction. It trades about -0.07 of its potential returns per unit of risk. Long Yuan Construction is currently generating about -0.26 per unit of risk. If you would invest 631.00 in Nanjing OLO Home on October 22, 2024 and sell it today you would lose (24.00) from holding Nanjing OLO Home or give up 3.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing OLO Home vs. Long Yuan Construction
Performance |
| Timeline |
| Nanjing OLO Home |
| Long Yuan Construction |
Nanjing OLO and Long Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing OLO and Long Yuan
The main advantage of trading using opposite Nanjing OLO and Long Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing OLO position performs unexpectedly, Long Yuan 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 Long Yuan will offset losses from the drop in Long Yuan's long position.| Nanjing OLO vs. CITIC Guoan Information | Nanjing OLO vs. Beijing Mainstreets Investment | Nanjing OLO vs. ZJBC Information Technology | Nanjing OLO vs. Nanjing Canatal Data |
| Long Yuan vs. Guangzhou KingTeller Technology | Long Yuan vs. Luyin Investment Group | Long Yuan vs. Jiujiang Shanshui Technology | Long Yuan vs. HanS Laser Tech |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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