Correlation Between Nanjing Medlander and Beijing Wandong
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By analyzing existing cross correlation between Nanjing Medlander Medical and Beijing Wandong Medical, you can compare the effects of market volatilities on Nanjing Medlander and Beijing Wandong 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 Nanjing Medlander with a short position of Beijing Wandong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Medlander and Beijing Wandong.
Diversification Opportunities for Nanjing Medlander and Beijing Wandong
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nanjing and Beijing is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Medlander Medical and Beijing Wandong Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Wandong Medical and Nanjing Medlander 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 Nanjing Medlander Medical are associated (or correlated) with Beijing Wandong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Wandong Medical has no effect on the direction of Nanjing Medlander i.e., Nanjing Medlander and Beijing Wandong go up and down completely randomly.
Pair Corralation between Nanjing Medlander and Beijing Wandong
Assuming the 90 days trading horizon Nanjing Medlander Medical is expected to under-perform the Beijing Wandong. But the stock apears to be less risky and, when comparing its historical volatility, Nanjing Medlander Medical is 1.15 times less risky than Beijing Wandong. The stock trades about -0.1 of its potential returns per unit of risk. The Beijing Wandong Medical is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,497 in Beijing Wandong Medical on August 29, 2024 and sell it today you would earn a total of 184.00 from holding Beijing Wandong Medical or generate 12.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing Medlander Medical vs. Beijing Wandong Medical
Performance |
| Timeline |
| Nanjing Medlander Medical |
| Beijing Wandong Medical |
Nanjing Medlander and Beijing Wandong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Medlander and Beijing Wandong
The main advantage of trading using opposite Nanjing Medlander and Beijing Wandong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Medlander position performs unexpectedly, Beijing Wandong 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 Wandong will offset losses from the drop in Beijing Wandong's long position.| Nanjing Medlander vs. Industrial and Commercial | Nanjing Medlander vs. China Construction Bank | Nanjing Medlander vs. Agricultural Bank of | Nanjing Medlander vs. Bank of China |
| Beijing Wandong vs. Sunwave Communications Co | Beijing Wandong vs. Hubei Xingfa Chemicals | Beijing Wandong vs. Shandong Polymer Biochemicals | Beijing Wandong vs. 360 Security 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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