Correlation Between Suzhou Novoprotein and CGN Nuclear
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By analyzing existing cross correlation between Suzhou Novoprotein Scientific and CGN Nuclear Technology, you can compare the effects of market volatilities on Suzhou Novoprotein and CGN Nuclear 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 Suzhou Novoprotein with a short position of CGN Nuclear. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suzhou Novoprotein and CGN Nuclear.
Diversification Opportunities for Suzhou Novoprotein and CGN Nuclear
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Suzhou and CGN is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Suzhou Novoprotein Scientific and CGN Nuclear Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CGN Nuclear Technology and Suzhou Novoprotein 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 Suzhou Novoprotein Scientific are associated (or correlated) with CGN Nuclear. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CGN Nuclear Technology has no effect on the direction of Suzhou Novoprotein i.e., Suzhou Novoprotein and CGN Nuclear go up and down completely randomly.
Pair Corralation between Suzhou Novoprotein and CGN Nuclear
Assuming the 90 days trading horizon Suzhou Novoprotein is expected to generate 1.88 times less return on investment than CGN Nuclear. In addition to that, Suzhou Novoprotein is 1.2 times more volatile than CGN Nuclear Technology. It trades about 0.1 of its total potential returns per unit of risk. CGN Nuclear Technology is currently generating about 0.22 per unit of volatility. If you would invest 614.00 in CGN Nuclear Technology on August 25, 2024 and sell it today you would earn a total of 178.00 from holding CGN Nuclear Technology or generate 28.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Suzhou Novoprotein Scientific vs. CGN Nuclear Technology
Performance |
| Timeline |
| Suzhou Novoprotein |
| CGN Nuclear Technology |
Suzhou Novoprotein and CGN Nuclear Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suzhou Novoprotein and CGN Nuclear
The main advantage of trading using opposite Suzhou Novoprotein and CGN Nuclear positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suzhou Novoprotein position performs unexpectedly, CGN Nuclear 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 CGN Nuclear will offset losses from the drop in CGN Nuclear's long position.The idea behind Suzhou Novoprotein Scientific and CGN Nuclear Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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