Correlation Between Zhejiang Yongjin and Ningbo Tip
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By analyzing existing cross correlation between Zhejiang Yongjin Metal and Ningbo Tip Rubber, you can compare the effects of market volatilities on Zhejiang Yongjin and Ningbo Tip 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 Zhejiang Yongjin with a short position of Ningbo Tip. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Yongjin and Ningbo Tip.
Diversification Opportunities for Zhejiang Yongjin and Ningbo Tip
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zhejiang and Ningbo is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Yongjin Metal and Ningbo Tip Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Tip Rubber and Zhejiang Yongjin 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 Zhejiang Yongjin Metal are associated (or correlated) with Ningbo Tip. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Tip Rubber has no effect on the direction of Zhejiang Yongjin i.e., Zhejiang Yongjin and Ningbo Tip go up and down completely randomly.
Pair Corralation between Zhejiang Yongjin and Ningbo Tip
Assuming the 90 days trading horizon Zhejiang Yongjin Metal is expected to generate 0.6 times more return on investment than Ningbo Tip. However, Zhejiang Yongjin Metal is 1.67 times less risky than Ningbo Tip. It trades about 0.08 of its potential returns per unit of risk. Ningbo Tip Rubber is currently generating about -0.03 per unit of risk. If you would invest 1,919 in Zhejiang Yongjin Metal on October 30, 2024 and sell it today you would earn a total of 96.00 from holding Zhejiang Yongjin Metal or generate 5.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Yongjin Metal vs. Ningbo Tip Rubber
Performance |
| Timeline |
| Zhejiang Yongjin Metal |
| Ningbo Tip Rubber |
Zhejiang Yongjin and Ningbo Tip Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Yongjin and Ningbo Tip
The main advantage of trading using opposite Zhejiang Yongjin and Ningbo Tip positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Yongjin position performs unexpectedly, Ningbo Tip 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 Tip will offset losses from the drop in Ningbo Tip's long position.| Zhejiang Yongjin vs. Zijin Mining Group | Zhejiang Yongjin vs. Wanhua Chemical Group | Zhejiang Yongjin vs. Baoshan Iron Steel | Zhejiang Yongjin vs. Shandong Gold Mining |
| Ningbo Tip vs. Kweichow Moutai Co | Ningbo Tip vs. Jiangsu Pacific Quartz | Ningbo Tip vs. Shenzhen Transsion Holdings | Ningbo Tip vs. Beijing Roborock Technology |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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