Correlation Between Jiangsu Pacific and Ningbo Fangzheng
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By analyzing existing cross correlation between Jiangsu Pacific Quartz and Ningbo Fangzheng Automobile, you can compare the effects of market volatilities on Jiangsu Pacific 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 Jiangsu Pacific with a short position of Ningbo Fangzheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Pacific and Ningbo Fangzheng.
Diversification Opportunities for Jiangsu Pacific and Ningbo Fangzheng
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jiangsu and Ningbo is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Pacific Quartz 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 Jiangsu Pacific 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 Jiangsu Pacific Quartz 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 Jiangsu Pacific i.e., Jiangsu Pacific and Ningbo Fangzheng go up and down completely randomly.
Pair Corralation between Jiangsu Pacific and Ningbo Fangzheng
Assuming the 90 days trading horizon Jiangsu Pacific Quartz is expected to generate 0.74 times more return on investment than Ningbo Fangzheng. However, Jiangsu Pacific Quartz is 1.35 times less risky than Ningbo Fangzheng. It trades about -0.01 of its potential returns per unit of risk. Ningbo Fangzheng Automobile is currently generating about -0.08 per unit of risk. If you would invest 2,652 in Jiangsu Pacific Quartz on November 5, 2024 and sell it today you would lose (19.00) from holding Jiangsu Pacific Quartz or give up 0.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Pacific Quartz vs. Ningbo Fangzheng Automobile
Performance |
| Timeline |
| Jiangsu Pacific Quartz |
| Ningbo Fangzheng Aut |
Jiangsu Pacific and Ningbo Fangzheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Pacific and Ningbo Fangzheng
The main advantage of trading using opposite Jiangsu Pacific and Ningbo Fangzheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Pacific 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.| Jiangsu Pacific vs. Epoxy Base Electronic | Jiangsu Pacific vs. Shenzhen Urban Transport | Jiangsu Pacific vs. Nantong Haixing Electronics | Jiangsu Pacific vs. Jiangyin Jianghua Microelectronics |
| Ningbo Fangzheng vs. Xinxiang Chemical Fiber | Ningbo Fangzheng vs. Cansino Biologics | Ningbo Fangzheng vs. Anhui Gujing Distillery | Ningbo Fangzheng vs. Jinhui Mining 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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