Correlation Between Zhongshan Public and Nanjing Putian
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By analyzing existing cross correlation between Zhongshan Public Utilities and Nanjing Putian Telecommunications, you can compare the effects of market volatilities on Zhongshan Public and Nanjing Putian 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 Zhongshan Public with a short position of Nanjing Putian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongshan Public and Nanjing Putian.
Diversification Opportunities for Zhongshan Public and Nanjing Putian
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhongshan and Nanjing is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Zhongshan Public Utilities and Nanjing Putian Telecommunicati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanjing Putian Telec and Zhongshan Public 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 Zhongshan Public Utilities are associated (or correlated) with Nanjing Putian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanjing Putian Telec has no effect on the direction of Zhongshan Public i.e., Zhongshan Public and Nanjing Putian go up and down completely randomly.
Pair Corralation between Zhongshan Public and Nanjing Putian
Assuming the 90 days trading horizon Zhongshan Public is expected to generate 3.68 times less return on investment than Nanjing Putian. But when comparing it to its historical volatility, Zhongshan Public Utilities is 1.45 times less risky than Nanjing Putian. It trades about 0.15 of its potential returns per unit of risk. Nanjing Putian Telecommunications is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 194.00 in Nanjing Putian Telecommunications on September 5, 2024 and sell it today you would earn a total of 265.00 from holding Nanjing Putian Telecommunications or generate 136.6% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 98.28% |
Values | Daily Returns |
Zhongshan Public Utilities vs. Nanjing Putian Telecommunicati
Performance |
Timeline |
Zhongshan Public Uti |
Nanjing Putian Telec |
Zhongshan Public and Nanjing Putian Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zhongshan Public and Nanjing Putian
The main advantage of trading using opposite Zhongshan Public and Nanjing Putian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongshan Public position performs unexpectedly, Nanjing Putian 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 Putian will offset losses from the drop in Nanjing Putian's long position.Zhongshan Public vs. Shanghai Action Education | Zhongshan Public vs. Hengdian Entertainment Co | Zhongshan Public vs. Zhejiang Publishing Media | Zhongshan Public vs. Lander Sports Development |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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