Correlation Between Nanjing Panda and CN MODERN
Can any of the company-specific risk be diversified away by investing in both Nanjing Panda and CN MODERN 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 Nanjing Panda and CN MODERN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nanjing Panda Electronics and CN MODERN DAIRY, you can compare the effects of market volatilities on Nanjing Panda and CN MODERN 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 Panda with a short position of CN MODERN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Panda and CN MODERN.
Diversification Opportunities for Nanjing Panda and CN MODERN
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nanjing and 07M is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Panda Electronics and CN MODERN DAIRY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CN MODERN DAIRY and Nanjing Panda 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 Panda Electronics are associated (or correlated) with CN MODERN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CN MODERN DAIRY has no effect on the direction of Nanjing Panda i.e., Nanjing Panda and CN MODERN go up and down completely randomly.
Pair Corralation between Nanjing Panda and CN MODERN
Assuming the 90 days horizon Nanjing Panda Electronics is expected to generate 1.11 times more return on investment than CN MODERN. However, Nanjing Panda is 1.11 times more volatile than CN MODERN DAIRY. It trades about 0.11 of its potential returns per unit of risk. CN MODERN DAIRY is currently generating about 0.12 per unit of risk. If you would invest 22.00 in Nanjing Panda Electronics on November 2, 2024 and sell it today you would earn a total of 11.00 from holding Nanjing Panda Electronics or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.03% |
| Values | Daily Returns |
Nanjing Panda Electronics vs. CN MODERN DAIRY
Performance |
| Timeline |
| Nanjing Panda Electronics |
| CN MODERN DAIRY |
Nanjing Panda and CN MODERN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Panda and CN MODERN
The main advantage of trading using opposite Nanjing Panda and CN MODERN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Panda position performs unexpectedly, CN MODERN 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 CN MODERN will offset losses from the drop in CN MODERN's long position.| Nanjing Panda vs. AMAG Austria Metall | Nanjing Panda vs. Fortescue Metals Group | Nanjing Panda vs. IMPERIAL TOBACCO | Nanjing Panda vs. URBAN OUTFITTERS |
| CN MODERN vs. TreeHouse Foods | CN MODERN vs. ADRIATIC METALS LS 013355 | CN MODERN vs. FIREWEED METALS P | CN MODERN vs. MAGNUM MINING EXP |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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