Correlation Between Nanya New and NBTM New
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By analyzing existing cross correlation between Nanya New Material and NBTM New Materials, you can compare the effects of market volatilities on Nanya New and NBTM New 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 Nanya New with a short position of NBTM New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanya New and NBTM New.
Diversification Opportunities for Nanya New and NBTM New
Poor diversification
The 3 months correlation between Nanya and NBTM is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Nanya New Material and NBTM New Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NBTM New Materials and Nanya New 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 Nanya New Material are associated (or correlated) with NBTM New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NBTM New Materials has no effect on the direction of Nanya New i.e., Nanya New and NBTM New go up and down completely randomly.
Pair Corralation between Nanya New and NBTM New
Assuming the 90 days trading horizon Nanya New Material is expected to generate 1.52 times more return on investment than NBTM New. However, Nanya New is 1.52 times more volatile than NBTM New Materials. It trades about 0.18 of its potential returns per unit of risk. NBTM New Materials is currently generating about 0.09 per unit of risk. If you would invest 2,226 in Nanya New Material on December 30, 2024 and sell it today you would earn a total of 1,284 from holding Nanya New Material or generate 57.68% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Nanya New Material vs. NBTM New Materials
Performance |
Timeline |
Nanya New Material |
NBTM New Materials |
Nanya New and NBTM New Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Nanya New and NBTM New
The main advantage of trading using opposite Nanya New and NBTM New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanya New position performs unexpectedly, NBTM New 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 NBTM New will offset losses from the drop in NBTM New's long position.Nanya New vs. Jiaozuo Wanfang Aluminum | Nanya New vs. Xinjiang Tianrun Dairy | Nanya New vs. Panda Dairy Corp | Nanya New vs. New Hope Dairy |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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