Correlation Between Jiangxi Naipu and MayAir Technology

Can any of the company-specific risk be diversified away by investing in both Jiangxi Naipu and MayAir Technology 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 Jiangxi Naipu and MayAir Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Jiangxi Naipu Mining and MayAir Technology Co, you can compare the effects of market volatilities on Jiangxi Naipu and MayAir Technology 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 Jiangxi Naipu with a short position of MayAir Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangxi Naipu and MayAir Technology.

Diversification Opportunities for Jiangxi Naipu and MayAir Technology

0.34

Correlation Coefficient

Jiangxi Naipu  MayAir Technology

Weak diversification

The 3 months correlation between Jiangxi and MayAir is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Jiangxi Naipu Mining and MayAir Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MayAir Technology and Jiangxi Naipu 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 Jiangxi Naipu Mining are associated (or correlated) with MayAir Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MayAir Technology has no effect on the direction of Jiangxi Naipu i.e., Jiangxi Naipu and MayAir Technology go up and down completely randomly.

Pair Corralation between Jiangxi Naipu and MayAir Technology

Assuming the 90 days trading horizon Jiangxi Naipu Mining is expected to generate 0.77 times more return on investment than MayAir Technology. However, Jiangxi Naipu Mining is 1.31 times less risky than MayAir Technology. It trades about -0.4 of its potential returns per unit of risk. MayAir Technology Co is currently generating about -0.44 per unit of risk. If you would invest  2,952  in Jiangxi Naipu Mining on October 9, 2024 and sell it today you would lose (332.00) from holding Jiangxi Naipu Mining or give up 11.25% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Jiangxi Naipu Mining  vs.  MayAir Technology Co

Jiangxi Naipu Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jiangxi Naipu Mining has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

MayAir Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MayAir Technology Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Jiangxi Naipu and MayAir Technology

The main advantage of trading using opposite Jiangxi Naipu and MayAir Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangxi Naipu position performs unexpectedly, MayAir Technology 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 MayAir Technology will offset losses from the drop in MayAir Technology's long position.

The idea behind Jiangxi Naipu Mining and MayAir Technology Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.