Correlation Between Niutech Environment and Chongqing Sokon
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By analyzing existing cross correlation between Niutech Environment Technology and Chongqing Sokon Ind, you can compare the effects of market volatilities on Niutech Environment and Chongqing Sokon 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 Niutech Environment with a short position of Chongqing Sokon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Niutech Environment and Chongqing Sokon.
Diversification Opportunities for Niutech Environment and Chongqing Sokon
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Niutech and Chongqing is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Niutech Environment Technology and Chongqing Sokon Ind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Sokon Ind and Niutech Environment 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 Niutech Environment Technology are associated (or correlated) with Chongqing Sokon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Sokon Ind has no effect on the direction of Niutech Environment i.e., Niutech Environment and Chongqing Sokon go up and down completely randomly.
Pair Corralation between Niutech Environment and Chongqing Sokon
Assuming the 90 days trading horizon Niutech Environment is expected to generate 1.45 times less return on investment than Chongqing Sokon. But when comparing it to its historical volatility, Niutech Environment Technology is 1.76 times less risky than Chongqing Sokon. It trades about 0.05 of its potential returns per unit of risk. Chongqing Sokon Ind is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 13,457 in Chongqing Sokon Ind on September 13, 2024 and sell it today you would earn a total of 234.00 from holding Chongqing Sokon Ind or generate 1.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Niutech Environment Technology vs. Chongqing Sokon Ind
Performance |
| Timeline |
| Niutech Environment |
| Chongqing Sokon Ind |
Niutech Environment and Chongqing Sokon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Niutech Environment and Chongqing Sokon
The main advantage of trading using opposite Niutech Environment and Chongqing Sokon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Niutech Environment position performs unexpectedly, Chongqing Sokon 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 Chongqing Sokon will offset losses from the drop in Chongqing Sokon's long position.| Niutech Environment vs. Changjiang Jinggong Steel | Niutech Environment vs. Anyang Iron Steel | Niutech Environment vs. Qiaoyin Environmental Tech | Niutech Environment vs. Guangdong Liantai Environmental |
| Chongqing Sokon vs. Focus Media Information | Chongqing Sokon vs. YLZ Information Tech | Chongqing Sokon vs. Yingde Greatchem Chemicals | Chongqing Sokon vs. Anhui Transport Consulting |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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