Correlation Between Nanjing Panda and Liberty Broadband
Can any of the company-specific risk be diversified away by investing in both Nanjing Panda and Liberty Broadband 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 Liberty Broadband 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 Liberty Broadband, you can compare the effects of market volatilities on Nanjing Panda and Liberty Broadband 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 Liberty Broadband. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Panda and Liberty Broadband.
Diversification Opportunities for Nanjing Panda and Liberty Broadband
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Nanjing and Liberty is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Panda Electronics and Liberty Broadband in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liberty Broadband 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 Liberty Broadband. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liberty Broadband has no effect on the direction of Nanjing Panda i.e., Nanjing Panda and Liberty Broadband go up and down completely randomly.
Pair Corralation between Nanjing Panda and Liberty Broadband
If you would invest 7,300 in Liberty Broadband on October 26, 2024 and sell it today you would earn a total of 50.00 from holding Liberty Broadband or generate 0.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing Panda Electronics vs. Liberty Broadband
Performance |
| Timeline |
| Nanjing Panda Electronics |
| Liberty Broadband |
Nanjing Panda and Liberty Broadband Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Panda and Liberty Broadband
The main advantage of trading using opposite Nanjing Panda and Liberty Broadband positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Panda position performs unexpectedly, Liberty Broadband 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 Liberty Broadband will offset losses from the drop in Liberty Broadband's long position.| Nanjing Panda vs. Hon Hai Precision | Nanjing Panda vs. Samsung SDI Co | Nanjing Panda vs. Corning Incorporated | Nanjing Panda vs. Mitsubishi Electric |
| Liberty Broadband vs. DEVRY EDUCATION GRP | Liberty Broadband vs. Xinhua Winshare Publishing | Liberty Broadband vs. Nanjing Panda Electronics | Liberty Broadband vs. STRAYER EDUCATION |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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