Correlation Between Ningbo Bird and Shenzhen Noposion

Can any of the company-specific risk be diversified away by investing in both Ningbo Bird and Shenzhen Noposion 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 Ningbo Bird and Shenzhen Noposion into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ningbo Bird Co and Shenzhen Noposion Agrochemicals, you can compare the effects of market volatilities on Ningbo Bird and Shenzhen Noposion 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 Bird with a short position of Shenzhen Noposion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Bird and Shenzhen Noposion.

Diversification Opportunities for Ningbo Bird and Shenzhen Noposion

0.0

Correlation Coefficient

Ningbo Bird  Shenzhen Noposion

Pay attention - limited upside

The 3 months correlation between Ningbo and Shenzhen is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Bird Co and Shenzhen Noposion Agrochemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Noposion and Ningbo Bird 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 Bird Co are associated (or correlated) with Shenzhen Noposion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Noposion has no effect on the direction of Ningbo Bird i.e., Ningbo Bird and Shenzhen Noposion go up and down completely randomly.

Pair Corralation between Ningbo Bird and Shenzhen Noposion

If you would invest  0.00  in Ningbo Bird Co on October 26, 2024 and sell it today you would earn a total of  0.00  from holding Ningbo Bird Co or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

Ningbo Bird Co  vs.  Shenzhen Noposion Agrochemical

Ningbo Bird

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ningbo Bird Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Ningbo Bird is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Shenzhen Noposion

Risk-Adjusted Performance

2 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Shenzhen Noposion Agrochemicals are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Shenzhen Noposion may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Ningbo Bird and Shenzhen Noposion

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

The idea behind Ningbo Bird Co and Shenzhen Noposion Agrochemicals 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.