Correlation Between Growth Fund and Ningbo Thermal
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By analyzing existing cross correlation between Growth Fund Of and Ningbo Thermal Power, you can compare the effects of market volatilities on Growth Fund and Ningbo Thermal 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 Growth Fund with a short position of Ningbo Thermal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Fund and Ningbo Thermal.
Diversification Opportunities for Growth Fund and Ningbo Thermal
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Growth and Ningbo is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Growth Fund Of and Ningbo Thermal Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Thermal Power and Growth Fund 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 Growth Fund Of are associated (or correlated) with Ningbo Thermal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Thermal Power has no effect on the direction of Growth Fund i.e., Growth Fund and Ningbo Thermal go up and down completely randomly.
Pair Corralation between Growth Fund and Ningbo Thermal
Assuming the 90 days horizon Growth Fund Of is expected to generate 0.44 times more return on investment than Ningbo Thermal. However, Growth Fund Of is 2.26 times less risky than Ningbo Thermal. It trades about 0.1 of its potential returns per unit of risk. Ningbo Thermal Power is currently generating about 0.04 per unit of risk. If you would invest 6,152 in Growth Fund Of on November 3, 2024 and sell it today you would earn a total of 1,679 from holding Growth Fund Of or generate 27.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.14% |
| Values | Daily Returns |
Growth Fund Of vs. Ningbo Thermal Power
Performance |
| Timeline |
| Growth Fund |
| Ningbo Thermal Power |
Growth Fund and Ningbo Thermal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Fund and Ningbo Thermal
The main advantage of trading using opposite Growth Fund and Ningbo Thermal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Fund position performs unexpectedly, Ningbo Thermal 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 Ningbo Thermal will offset losses from the drop in Ningbo Thermal's long position.| Growth Fund vs. Capital World Growth | Growth Fund vs. Europacific Growth Fund | Growth Fund vs. New Perspective Fund | Growth Fund vs. Investment Of America |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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