Correlation Between Ningbo Tech and Fujian Newland
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By analyzing existing cross correlation between Ningbo Tech Bank Co and Fujian Newland Computer, you can compare the effects of market volatilities on Ningbo Tech and Fujian Newland 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 Ningbo Tech with a short position of Fujian Newland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Tech and Fujian Newland.
Diversification Opportunities for Ningbo Tech and Fujian Newland
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ningbo and Fujian is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Tech Bank Co and Fujian Newland Computer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Newland Computer and Ningbo Tech 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 Ningbo Tech Bank Co are associated (or correlated) with Fujian Newland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Newland Computer has no effect on the direction of Ningbo Tech i.e., Ningbo Tech and Fujian Newland go up and down completely randomly.
Pair Corralation between Ningbo Tech and Fujian Newland
Assuming the 90 days trading horizon Ningbo Tech Bank Co is expected to under-perform the Fujian Newland. In addition to that, Ningbo Tech is 1.0 times more volatile than Fujian Newland Computer. It trades about -0.01 of its total potential returns per unit of risk. Fujian Newland Computer is currently generating about 0.04 per unit of volatility. If you would invest 1,604 in Fujian Newland Computer on October 9, 2024 and sell it today you would earn a total of 188.00 from holding Fujian Newland Computer or generate 11.72% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Ningbo Tech Bank Co vs. Fujian Newland Computer
Performance |
Timeline |
Ningbo Tech Bank |
Fujian Newland Computer |
Ningbo Tech and Fujian Newland Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ningbo Tech and Fujian Newland
The main advantage of trading using opposite Ningbo Tech and Fujian Newland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Tech position performs unexpectedly, Fujian Newland 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 Fujian Newland will offset losses from the drop in Fujian Newland's long position.Ningbo Tech vs. Fiberhome Telecommunication Technologies | Ningbo Tech vs. China Mobile Limited | Ningbo Tech vs. Mengtian Home Group | Ningbo Tech vs. SUNSEA Telecommunications Co |
Fujian Newland vs. China Aluminum International | Fujian Newland vs. Guangzhou Zhujiang Brewery | Fujian Newland vs. Weichai Heavy Machinery | Fujian Newland vs. Aluminum Corp of |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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