Correlation Between CN DATANG and Nisshinbo Holdings
Can any of the company-specific risk be diversified away by investing in both CN DATANG and Nisshinbo Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining CN DATANG and Nisshinbo Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CN DATANG C and Nisshinbo Holdings, you can compare the effects of market volatilities on CN DATANG and Nisshinbo Holdings 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 CN DATANG with a short position of Nisshinbo Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of CN DATANG and Nisshinbo Holdings.
Diversification Opportunities for CN DATANG and Nisshinbo Holdings
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between DT7 and Nisshinbo is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding CN DATANG C and Nisshinbo Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nisshinbo Holdings and CN DATANG 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 CN DATANG C are associated (or correlated) with Nisshinbo Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nisshinbo Holdings has no effect on the direction of CN DATANG i.e., CN DATANG and Nisshinbo Holdings go up and down completely randomly.
Pair Corralation between CN DATANG and Nisshinbo Holdings
Assuming the 90 days trading horizon CN DATANG C is expected to generate 1.58 times more return on investment than Nisshinbo Holdings. However, CN DATANG is 1.58 times more volatile than Nisshinbo Holdings. It trades about 0.01 of its potential returns per unit of risk. Nisshinbo Holdings is currently generating about -0.08 per unit of risk. If you would invest 24.00 in CN DATANG C on October 10, 2024 and sell it today you would earn a total of 0.00 from holding CN DATANG C or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
CN DATANG C vs. Nisshinbo Holdings
Performance |
| Timeline |
| CN DATANG C |
| Nisshinbo Holdings |
CN DATANG and Nisshinbo Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CN DATANG and Nisshinbo Holdings
The main advantage of trading using opposite CN DATANG and Nisshinbo Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CN DATANG position performs unexpectedly, Nisshinbo Holdings 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 Nisshinbo Holdings will offset losses from the drop in Nisshinbo Holdings' long position.| CN DATANG vs. MOBILE FACTORY INC | CN DATANG vs. CyberArk Software | CN DATANG vs. Check Point Software | CN DATANG vs. SOCKET MOBILE NEW |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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