Correlation Between Accelleron Industries and ZKH Group

Can any of the company-specific risk be diversified away by investing in both Accelleron Industries and ZKH Group 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 Accelleron Industries and ZKH Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Accelleron Industries AG and ZKH Group Limited, you can compare the effects of market volatilities on Accelleron Industries and ZKH Group 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 Accelleron Industries with a short position of ZKH Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accelleron Industries and ZKH Group.

Diversification Opportunities for Accelleron Industries and ZKH Group

0.15

Correlation Coefficient

Accelleron Industries  ZKH Group

Average diversification

The 3 months correlation between Accelleron and ZKH is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Accelleron Industries AG and ZKH Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZKH Group Limited and Accelleron Industries 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 Accelleron Industries AG are associated (or correlated) with ZKH Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZKH Group Limited has no effect on the direction of Accelleron Industries i.e., Accelleron Industries and ZKH Group go up and down completely randomly.

Pair Corralation between Accelleron Industries and ZKH Group

Assuming the 90 days trading horizon Accelleron Industries is expected to generate 3.07 times less return on investment than ZKH Group. But when comparing it to its historical volatility, Accelleron Industries AG is 2.38 times less risky than ZKH Group. It trades about 0.06 of its potential returns per unit of risk. ZKH Group Limited is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  297.00  in ZKH Group Limited on October 3, 2024 and sell it today you would earn a total of  54.00  from holding ZKH Group Limited or generate 18.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.81%
Values	Daily Returns

Accelleron Industries AG  vs.  ZKH Group Limited

Accelleron Industries

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Accelleron Industries AG are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Accelleron Industries may actually be approaching a critical reversion point that can send shares even higher in February 2025.

ZKH Group Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ZKH Group Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward-looking signals, ZKH Group is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Accelleron Industries and ZKH Group

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

The idea behind Accelleron Industries AG and ZKH Group Limited 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.