Correlation Between Ningbo Tip and Cangzhou Mingzhu
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By analyzing existing cross correlation between Ningbo Tip Rubber and Cangzhou Mingzhu Plastic, you can compare the effects of market volatilities on Ningbo Tip and Cangzhou Mingzhu 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 Ningbo Tip with a short position of Cangzhou Mingzhu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Tip and Cangzhou Mingzhu.
Diversification Opportunities for Ningbo Tip and Cangzhou Mingzhu
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ningbo and Cangzhou is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Tip Rubber and Cangzhou Mingzhu Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cangzhou Mingzhu Plastic and Ningbo Tip 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 Ningbo Tip Rubber are associated (or correlated) with Cangzhou Mingzhu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cangzhou Mingzhu Plastic has no effect on the direction of Ningbo Tip i.e., Ningbo Tip and Cangzhou Mingzhu go up and down completely randomly.
Pair Corralation between Ningbo Tip and Cangzhou Mingzhu
Assuming the 90 days trading horizon Ningbo Tip Rubber is expected to generate 1.93 times more return on investment than Cangzhou Mingzhu. However, Ningbo Tip is 1.93 times more volatile than Cangzhou Mingzhu Plastic. It trades about -0.08 of its potential returns per unit of risk. Cangzhou Mingzhu Plastic is currently generating about -0.22 per unit of risk. If you would invest 1,377 in Ningbo Tip Rubber on October 21, 2024 and sell it today you would lose (92.00) from holding Ningbo Tip Rubber or give up 6.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Tip Rubber vs. Cangzhou Mingzhu Plastic
Performance |
| Timeline |
| Ningbo Tip Rubber |
| Cangzhou Mingzhu Plastic |
Ningbo Tip and Cangzhou Mingzhu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Tip and Cangzhou Mingzhu
The main advantage of trading using opposite Ningbo Tip and Cangzhou Mingzhu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Tip position performs unexpectedly, Cangzhou Mingzhu 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 Cangzhou Mingzhu will offset losses from the drop in Cangzhou Mingzhu's long position.| Ningbo Tip vs. Aba Chemicals Corp | Ningbo Tip vs. Hubei Xingfa Chemicals | Ningbo Tip vs. Shannon Semiconductor Technology | Ningbo Tip vs. Glodon Software Co |
| Cangzhou Mingzhu vs. Zhejiang Kingland Pipeline | Cangzhou Mingzhu vs. Hunan Mendale Hometextile | Cangzhou Mingzhu vs. Hengxin Mobile Business | Cangzhou Mingzhu vs. Hithink RoyalFlush Info |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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