Correlation Between Zhejiang Tailin and Postal Savings

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Can any of the company-specific risk be diversified away by investing in both Zhejiang Tailin and Postal Savings 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 Zhejiang Tailin and Postal Savings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zhejiang Tailin Bioengineering and Postal Savings Bank, you can compare the effects of market volatilities on Zhejiang Tailin and Postal Savings 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 Tailin with a short position of Postal Savings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Tailin and Postal Savings.

Diversification Opportunities for Zhejiang Tailin and Postal Savings

ZhejiangPostalDiversified AwayZhejiangPostalDiversified Away100%
-0.29
  Correlation Coefficient

Very good diversification

The 3 months correlation between Zhejiang and Postal is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Tailin Bioengineering and Postal Savings Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postal Savings Bank and Zhejiang Tailin 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 Tailin Bioengineering are associated (or correlated) with Postal Savings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postal Savings Bank has no effect on the direction of Zhejiang Tailin i.e., Zhejiang Tailin and Postal Savings go up and down completely randomly.

Pair Corralation between Zhejiang Tailin and Postal Savings

Assuming the 90 days trading horizon Zhejiang Tailin Bioengineering is expected to under-perform the Postal Savings. In addition to that, Zhejiang Tailin is 1.75 times more volatile than Postal Savings Bank. It trades about -0.13 of its total potential returns per unit of risk. Postal Savings Bank is currently generating about 0.01 per unit of volatility. If you would invest  525.00  in Postal Savings Bank on November 15, 2024 and sell it today you would earn a total of  2.00  from holding Postal Savings Bank or generate 0.38% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Zhejiang Tailin Bioengineering  vs.  Postal Savings Bank

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -20-15-10-50510
JavaScript chart by amCharts 3.21.15300813 601658
       Timeline  
Zhejiang Tailin Bioe 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Zhejiang Tailin Bioengineering has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb161718192021222324
Postal Savings Bank 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Over the last 90 days Postal Savings Bank has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Postal Savings is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb5.25.35.45.55.65.7

Zhejiang Tailin and Postal Savings Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.34-3.25-2.16-1.070.01.022.053.074.1 0.050.100.150.20
JavaScript chart by amCharts 3.21.15300813 601658
       Returns  

Pair Trading with Zhejiang Tailin and Postal Savings

The main advantage of trading using opposite Zhejiang Tailin and Postal Savings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Tailin position performs unexpectedly, Postal Savings 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 Postal Savings will offset losses from the drop in Postal Savings' long position.
The idea behind Zhejiang Tailin Bioengineering and Postal Savings Bank 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.

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