Correlation Between Zotye Automobile and Zangge Holding
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By analyzing existing cross correlation between Zotye Automobile Co and Zangge Holding Co, you can compare the effects of market volatilities on Zotye Automobile and Zangge Holding 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 Zotye Automobile with a short position of Zangge Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zotye Automobile and Zangge Holding.
Diversification Opportunities for Zotye Automobile and Zangge Holding
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zotye and Zangge is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Zotye Automobile Co and Zangge Holding Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zangge Holding and Zotye Automobile 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 Zotye Automobile Co are associated (or correlated) with Zangge Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zangge Holding has no effect on the direction of Zotye Automobile i.e., Zotye Automobile and Zangge Holding go up and down completely randomly.
Pair Corralation between Zotye Automobile and Zangge Holding
Assuming the 90 days trading horizon Zotye Automobile Co is expected to generate 3.64 times more return on investment than Zangge Holding. However, Zotye Automobile is 3.64 times more volatile than Zangge Holding Co. It trades about 0.1 of its potential returns per unit of risk. Zangge Holding Co is currently generating about -0.15 per unit of risk. If you would invest 254.00 in Zotye Automobile Co on September 25, 2024 and sell it today you would earn a total of 20.00 from holding Zotye Automobile Co or generate 7.87% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.45% |
Values | Daily Returns |
Zotye Automobile Co vs. Zangge Holding Co
Performance |
Timeline |
Zotye Automobile |
Zangge Holding |
Zotye Automobile and Zangge Holding Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zotye Automobile and Zangge Holding
The main advantage of trading using opposite Zotye Automobile and Zangge Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zotye Automobile position performs unexpectedly, Zangge Holding 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 Zangge Holding will offset losses from the drop in Zangge Holding's long position.Zotye Automobile vs. Xilong Chemical Co | Zotye Automobile vs. Hengli Petrochemical Co | Zotye Automobile vs. Xinxiang Chemical Fiber | Zotye Automobile vs. Hubeiyichang Transportation Group |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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