Correlation Between Zhejiang Huatong and China Sports
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By analyzing existing cross correlation between Zhejiang Huatong Meat and China Sports Industry, you can compare the effects of market volatilities on Zhejiang Huatong and China Sports 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 Zhejiang Huatong with a short position of China Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Huatong and China Sports.
Diversification Opportunities for Zhejiang Huatong and China Sports
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhejiang and China is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Huatong Meat and China Sports Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Sports Industry and Zhejiang Huatong 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 Zhejiang Huatong Meat are associated (or correlated) with China Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Sports Industry has no effect on the direction of Zhejiang Huatong i.e., Zhejiang Huatong and China Sports go up and down completely randomly.
Pair Corralation between Zhejiang Huatong and China Sports
Assuming the 90 days trading horizon Zhejiang Huatong is expected to generate 3.07 times less return on investment than China Sports. But when comparing it to its historical volatility, Zhejiang Huatong Meat is 1.04 times less risky than China Sports. It trades about 0.04 of its potential returns per unit of risk. China Sports Industry is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 805.00 in China Sports Industry on September 25, 2024 and sell it today you would earn a total of 55.00 from holding China Sports Industry or generate 6.83% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Zhejiang Huatong Meat vs. China Sports Industry
Performance |
Timeline |
Zhejiang Huatong Meat |
China Sports Industry |
Zhejiang Huatong and China Sports Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zhejiang Huatong and China Sports
The main advantage of trading using opposite Zhejiang Huatong and China Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Huatong position performs unexpectedly, China Sports 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 China Sports will offset losses from the drop in China Sports' long position.Zhejiang Huatong vs. Chongqing Shunbo Aluminum | Zhejiang Huatong vs. China Aluminum International | Zhejiang Huatong vs. Sportsoul Co Ltd | Zhejiang Huatong vs. Sino Platinum Metals Co |
China Sports vs. Qingdao Foods Co | China Sports vs. Shandong Sinoglory Health | China Sports vs. Guilin Seamild Foods | China Sports vs. Zhejiang Huatong Meat |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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