Correlation Between Namchow Food and Beijing Kingsoft
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By analyzing existing cross correlation between Namchow Food Group and Beijing Kingsoft Office, you can compare the effects of market volatilities on Namchow Food and Beijing Kingsoft 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 Namchow Food with a short position of Beijing Kingsoft. Check out your portfolio center. Please also check ongoing floating volatility patterns of Namchow Food and Beijing Kingsoft.
Diversification Opportunities for Namchow Food and Beijing Kingsoft
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Namchow and Beijing is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Namchow Food Group and Beijing Kingsoft Office in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Kingsoft Office and Namchow Food 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 Namchow Food Group are associated (or correlated) with Beijing Kingsoft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Kingsoft Office has no effect on the direction of Namchow Food i.e., Namchow Food and Beijing Kingsoft go up and down completely randomly.
Pair Corralation between Namchow Food and Beijing Kingsoft
Assuming the 90 days trading horizon Namchow Food is expected to generate 5.31 times less return on investment than Beijing Kingsoft. But when comparing it to its historical volatility, Namchow Food Group is 1.06 times less risky than Beijing Kingsoft. It trades about 0.02 of its potential returns per unit of risk. Beijing Kingsoft Office is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 29,540 in Beijing Kingsoft Office on October 31, 2024 and sell it today you would earn a total of 1,860 from holding Beijing Kingsoft Office or generate 6.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Namchow Food Group vs. Beijing Kingsoft Office
Performance |
| Timeline |
| Namchow Food Group |
| Beijing Kingsoft Office |
Namchow Food and Beijing Kingsoft Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Namchow Food and Beijing Kingsoft
The main advantage of trading using opposite Namchow Food and Beijing Kingsoft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Namchow Food position performs unexpectedly, Beijing Kingsoft 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 Beijing Kingsoft will offset losses from the drop in Beijing Kingsoft's long position.| Namchow Food vs. Tibet Huayu Mining | Namchow Food vs. Hainan Mining Co | Namchow Food vs. Nanxing Furniture Machinery | Namchow Food vs. Zijin Mining Group |
| Beijing Kingsoft vs. Zhejiang Yinlun Machinery | Beijing Kingsoft vs. Huasi Agricultural Development | Beijing Kingsoft vs. Shanghai Construction Group | Beijing Kingsoft vs. Hangzhou Arcvideo 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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