Correlation Between Qumei Furniture and Suzhou Novoprotein
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By analyzing existing cross correlation between Qumei Furniture Group and Suzhou Novoprotein Scientific, you can compare the effects of market volatilities on Qumei Furniture and Suzhou Novoprotein 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 Qumei Furniture with a short position of Suzhou Novoprotein. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qumei Furniture and Suzhou Novoprotein.
Diversification Opportunities for Qumei Furniture and Suzhou Novoprotein
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Qumei and Suzhou is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Qumei Furniture Group and Suzhou Novoprotein Scientific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzhou Novoprotein and Qumei Furniture 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 Qumei Furniture Group are associated (or correlated) with Suzhou Novoprotein. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzhou Novoprotein has no effect on the direction of Qumei Furniture i.e., Qumei Furniture and Suzhou Novoprotein go up and down completely randomly.
Pair Corralation between Qumei Furniture and Suzhou Novoprotein
Assuming the 90 days trading horizon Qumei Furniture Group is expected to generate 1.05 times more return on investment than Suzhou Novoprotein. However, Qumei Furniture is 1.05 times more volatile than Suzhou Novoprotein Scientific. It trades about -0.03 of its potential returns per unit of risk. Suzhou Novoprotein Scientific is currently generating about -0.04 per unit of risk. If you would invest 673.00 in Qumei Furniture Group on September 12, 2024 and sell it today you would lose (323.00) from holding Qumei Furniture Group or give up 47.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qumei Furniture Group vs. Suzhou Novoprotein Scientific
Performance |
| Timeline |
| Qumei Furniture Group |
| Suzhou Novoprotein |
Qumei Furniture and Suzhou Novoprotein Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qumei Furniture and Suzhou Novoprotein
The main advantage of trading using opposite Qumei Furniture and Suzhou Novoprotein positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qumei Furniture position performs unexpectedly, Suzhou Novoprotein 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 Suzhou Novoprotein will offset losses from the drop in Suzhou Novoprotein's long position.| Qumei Furniture vs. Lutian Machinery Co | Qumei Furniture vs. PetroChina Co Ltd | Qumei Furniture vs. Bank of China | Qumei Furniture vs. Gansu Jiu Steel |
| Suzhou Novoprotein vs. Shanghai Shuixing Home | Suzhou Novoprotein vs. Markor International Home | Suzhou Novoprotein vs. Qumei Furniture Group | Suzhou Novoprotein vs. Xinhua Winshare Publishing |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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