Correlation Between Yanzhou Coal and NURAN WIRELESS
Can any of the company-specific risk be diversified away by investing in both Yanzhou Coal and NURAN WIRELESS 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 Yanzhou Coal and NURAN WIRELESS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yanzhou Coal Mining and NURAN WIRELESS INC, you can compare the effects of market volatilities on Yanzhou Coal and NURAN WIRELESS 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 Yanzhou Coal with a short position of NURAN WIRELESS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yanzhou Coal and NURAN WIRELESS.
Diversification Opportunities for Yanzhou Coal and NURAN WIRELESS
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Yanzhou and NURAN is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Yanzhou Coal Mining and NURAN WIRELESS INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NURAN WIRELESS INC and Yanzhou Coal 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 Yanzhou Coal Mining are associated (or correlated) with NURAN WIRELESS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NURAN WIRELESS INC has no effect on the direction of Yanzhou Coal i.e., Yanzhou Coal and NURAN WIRELESS go up and down completely randomly.
Pair Corralation between Yanzhou Coal and NURAN WIRELESS
Assuming the 90 days horizon Yanzhou Coal Mining is expected to generate 0.4 times more return on investment than NURAN WIRELESS. However, Yanzhou Coal Mining is 2.52 times less risky than NURAN WIRELESS. It trades about 0.04 of its potential returns per unit of risk. NURAN WIRELESS INC is currently generating about 0.01 per unit of risk. If you would invest 745.00 in Yanzhou Coal Mining on October 30, 2024 and sell it today you would earn a total of 265.00 from holding Yanzhou Coal Mining or generate 35.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.75% |
| Values | Daily Returns |
Yanzhou Coal Mining vs. NURAN WIRELESS INC
Performance |
| Timeline |
| Yanzhou Coal Mining |
| NURAN WIRELESS INC |
Yanzhou Coal and NURAN WIRELESS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yanzhou Coal and NURAN WIRELESS
The main advantage of trading using opposite Yanzhou Coal and NURAN WIRELESS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yanzhou Coal position performs unexpectedly, NURAN WIRELESS 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 NURAN WIRELESS will offset losses from the drop in NURAN WIRELESS's long position.| Yanzhou Coal vs. ONWARD MEDICAL BV | Yanzhou Coal vs. MICRONIC MYDATA | Yanzhou Coal vs. CVR Medical Corp | Yanzhou Coal vs. PULSION Medical Systems |
| NURAN WIRELESS vs. GRIFFIN MINING LTD | NURAN WIRELESS vs. Linedata Services SA | NURAN WIRELESS vs. China Datang | NURAN WIRELESS vs. Harmony Gold Mining |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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