Correlation Between Mitsubishi Electric and Nanjing Panda
Can any of the company-specific risk be diversified away by investing in both Mitsubishi Electric and Nanjing Panda 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 Mitsubishi Electric and Nanjing Panda into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mitsubishi Electric and Nanjing Panda Electronics, you can compare the effects of market volatilities on Mitsubishi Electric and Nanjing Panda 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 Mitsubishi Electric with a short position of Nanjing Panda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitsubishi Electric and Nanjing Panda.
Diversification Opportunities for Mitsubishi Electric and Nanjing Panda
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mitsubishi and Nanjing is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mitsubishi Electric and Nanjing Panda Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanjing Panda Electronics and Mitsubishi Electric 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 Mitsubishi Electric are associated (or correlated) with Nanjing Panda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanjing Panda Electronics has no effect on the direction of Mitsubishi Electric i.e., Mitsubishi Electric and Nanjing Panda go up and down completely randomly.
Pair Corralation between Mitsubishi Electric and Nanjing Panda
Assuming the 90 days trading horizon Mitsubishi Electric is expected to generate 1.56 times less return on investment than Nanjing Panda. But when comparing it to its historical volatility, Mitsubishi Electric is 2.77 times less risky than Nanjing Panda. It trades about 0.05 of its potential returns per unit of risk. Nanjing Panda Electronics is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 40.00 in Nanjing Panda Electronics on November 5, 2024 and sell it today you would lose (7.00) from holding Nanjing Panda Electronics or give up 17.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Mitsubishi Electric vs. Nanjing Panda Electronics
Performance |
| Timeline |
| Mitsubishi Electric |
| Nanjing Panda Electronics |
Mitsubishi Electric and Nanjing Panda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mitsubishi Electric and Nanjing Panda
The main advantage of trading using opposite Mitsubishi Electric and Nanjing Panda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitsubishi Electric position performs unexpectedly, Nanjing Panda 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 Nanjing Panda will offset losses from the drop in Nanjing Panda's long position.| Mitsubishi Electric vs. COVIVIO HOTELS INH | Mitsubishi Electric vs. Summit Hotel Properties | Mitsubishi Electric vs. Hyatt Hotels | Mitsubishi Electric vs. Park Hotels Resorts |
| Nanjing Panda vs. China National Building | Nanjing Panda vs. Hyster Yale Materials Handling | Nanjing Panda vs. Benchmark Electronics | Nanjing Panda vs. STMICROELECTRONICS |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators |