Correlation Between Zhejiang Daily and China Great
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By analyzing existing cross correlation between Zhejiang Daily Media and China Great Wall, you can compare the effects of market volatilities on Zhejiang Daily and China Great 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 Daily with a short position of China Great. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Daily and China Great.
Diversification Opportunities for Zhejiang Daily and China Great
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 Daily Media and China Great Wall in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Great Wall and Zhejiang Daily 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 Daily Media are associated (or correlated) with China Great. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Great Wall has no effect on the direction of Zhejiang Daily i.e., Zhejiang Daily and China Great go up and down completely randomly.
Pair Corralation between Zhejiang Daily and China Great
Assuming the 90 days trading horizon Zhejiang Daily is expected to generate 2.92 times less return on investment than China Great. In addition to that, Zhejiang Daily is 1.96 times more volatile than China Great Wall. It trades about 0.01 of its total potential returns per unit of risk. China Great Wall is currently generating about 0.06 per unit of volatility. If you would invest 821.00 in China Great Wall on September 25, 2024 and sell it today you would earn a total of 12.00 from holding China Great Wall or generate 1.46% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Zhejiang Daily Media vs. China Great Wall
Performance |
Timeline |
Zhejiang Daily Media |
China Great Wall |
Zhejiang Daily and China Great Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zhejiang Daily and China Great
The main advantage of trading using opposite Zhejiang Daily and China Great positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Daily position performs unexpectedly, China Great 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 Great will offset losses from the drop in China Great's long position.Zhejiang Daily vs. Runjian Communication Co | Zhejiang Daily vs. Eastern Communications Co | Zhejiang Daily vs. China Asset Management | Zhejiang Daily vs. Harbin Hatou Investment |
China Great vs. Kweichow Moutai Co | China Great vs. Contemporary Amperex Technology | China Great vs. G bits Network Technology | China Great vs. BYD Co Ltd |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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