Correlation Between Nanjing Panda and NH HOTEL
Can any of the company-specific risk be diversified away by investing in both Nanjing Panda and NH HOTEL 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 NH HOTEL 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 NH HOTEL GROUP, you can compare the effects of market volatilities on Nanjing Panda and NH HOTEL 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 NH HOTEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Panda and NH HOTEL.
Diversification Opportunities for Nanjing Panda and NH HOTEL
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Nanjing and NH5 is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Panda Electronics and NH HOTEL GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH HOTEL GROUP 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 NH HOTEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH HOTEL GROUP has no effect on the direction of Nanjing Panda i.e., Nanjing Panda and NH HOTEL go up and down completely randomly.
Pair Corralation between Nanjing Panda and NH HOTEL
If you would invest 443.00 in NH HOTEL GROUP on October 12, 2024 and sell it today you would earn a total of 179.00 from holding NH HOTEL GROUP or generate 40.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
Nanjing Panda Electronics vs. NH HOTEL GROUP
Performance |
| Timeline |
| Nanjing Panda Electronics |
| NH HOTEL GROUP |
Nanjing Panda and NH HOTEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Panda and NH HOTEL
The main advantage of trading using opposite Nanjing Panda and NH HOTEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Panda position performs unexpectedly, NH HOTEL 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 NH HOTEL will offset losses from the drop in NH HOTEL's long position.| Nanjing Panda vs. Astral Foods Limited | Nanjing Panda vs. Performance Food Group | Nanjing Panda vs. Nomad Foods | Nanjing Panda vs. United Natural Foods |
| NH HOTEL vs. DIVERSIFIED ROYALTY | NH HOTEL vs. Nanjing Panda Electronics | NH HOTEL vs. STORE ELECTRONIC | NH HOTEL vs. Electronic Arts |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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