Correlation Between Great Sun and Ningbo Fangzheng
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By analyzing existing cross correlation between Great Sun Foods Co and Ningbo Fangzheng Automobile, you can compare the effects of market volatilities on Great Sun and Ningbo Fangzheng 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 Great Sun with a short position of Ningbo Fangzheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great Sun and Ningbo Fangzheng.
Diversification Opportunities for Great Sun and Ningbo Fangzheng
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Great and Ningbo is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Great Sun Foods Co and Ningbo Fangzheng Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Fangzheng Aut and Great Sun 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 Great Sun Foods Co are associated (or correlated) with Ningbo Fangzheng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Fangzheng Aut has no effect on the direction of Great Sun i.e., Great Sun and Ningbo Fangzheng go up and down completely randomly.
Pair Corralation between Great Sun and Ningbo Fangzheng
Assuming the 90 days trading horizon Great Sun is expected to generate 1.69 times less return on investment than Ningbo Fangzheng. In addition to that, Great Sun is 1.3 times more volatile than Ningbo Fangzheng Automobile. It trades about 0.08 of its total potential returns per unit of risk. Ningbo Fangzheng Automobile is currently generating about 0.17 per unit of volatility. If you would invest 1,475 in Ningbo Fangzheng Automobile on September 4, 2024 and sell it today you would earn a total of 169.00 from holding Ningbo Fangzheng Automobile or generate 11.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Great Sun Foods Co vs. Ningbo Fangzheng Automobile
Performance |
| Timeline |
| Great Sun Foods |
| Ningbo Fangzheng Aut |
Great Sun and Ningbo Fangzheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great Sun and Ningbo Fangzheng
The main advantage of trading using opposite Great Sun and Ningbo Fangzheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great Sun position performs unexpectedly, Ningbo Fangzheng 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 Ningbo Fangzheng will offset losses from the drop in Ningbo Fangzheng's long position.| Great Sun vs. Jilin Jlu Communication | Great Sun vs. State Grid InformationCommunication | Great Sun vs. Eastern Communications Co | Great Sun vs. Anhui Deli Household |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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