Correlation Between Nexchip Semiconductor and Guangdong Fenghua
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By analyzing existing cross correlation between Nexchip Semiconductor Corp and Guangdong Fenghua Advanced, you can compare the effects of market volatilities on Nexchip Semiconductor and Guangdong Fenghua 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 Nexchip Semiconductor with a short position of Guangdong Fenghua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexchip Semiconductor and Guangdong Fenghua.
Diversification Opportunities for Nexchip Semiconductor and Guangdong Fenghua
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nexchip and Guangdong is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Nexchip Semiconductor Corp and Guangdong Fenghua Advanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Fenghua and Nexchip Semiconductor 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 Nexchip Semiconductor Corp are associated (or correlated) with Guangdong Fenghua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Fenghua has no effect on the direction of Nexchip Semiconductor i.e., Nexchip Semiconductor and Guangdong Fenghua go up and down completely randomly.
Pair Corralation between Nexchip Semiconductor and Guangdong Fenghua
Assuming the 90 days trading horizon Nexchip Semiconductor Corp is expected to generate 1.78 times more return on investment than Guangdong Fenghua. However, Nexchip Semiconductor is 1.78 times more volatile than Guangdong Fenghua Advanced. It trades about 0.25 of its potential returns per unit of risk. Guangdong Fenghua Advanced is currently generating about 0.12 per unit of risk. If you would invest 1,373 in Nexchip Semiconductor Corp on September 12, 2024 and sell it today you would earn a total of 1,293 from holding Nexchip Semiconductor Corp or generate 94.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nexchip Semiconductor Corp vs. Guangdong Fenghua Advanced
Performance |
| Timeline |
| Nexchip Semiconductor |
| Guangdong Fenghua |
Nexchip Semiconductor and Guangdong Fenghua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexchip Semiconductor and Guangdong Fenghua
The main advantage of trading using opposite Nexchip Semiconductor and Guangdong Fenghua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexchip Semiconductor position performs unexpectedly, Guangdong Fenghua 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 Guangdong Fenghua will offset losses from the drop in Guangdong Fenghua's long position.| Nexchip Semiconductor vs. Hua Xia Bank | Nexchip Semiconductor vs. Guosheng Financial Holding | Nexchip Semiconductor vs. Xinjiang Tianrun Dairy | Nexchip Semiconductor vs. Guilin Seamild Foods |
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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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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