Correlation Between Zhengzhou Coal and Shenzhen Kexin
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By analyzing existing cross correlation between Zhengzhou Coal Mining and Shenzhen Kexin Communication, you can compare the effects of market volatilities on Zhengzhou Coal and Shenzhen Kexin 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 Zhengzhou Coal with a short position of Shenzhen Kexin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhengzhou Coal and Shenzhen Kexin.
Diversification Opportunities for Zhengzhou Coal and Shenzhen Kexin
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zhengzhou and Shenzhen is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Zhengzhou Coal Mining and Shenzhen Kexin Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Kexin Commu and Zhengzhou Coal 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 Zhengzhou Coal Mining are associated (or correlated) with Shenzhen Kexin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Kexin Commu has no effect on the direction of Zhengzhou Coal i.e., Zhengzhou Coal and Shenzhen Kexin go up and down completely randomly.
Pair Corralation between Zhengzhou Coal and Shenzhen Kexin
Assuming the 90 days trading horizon Zhengzhou Coal Mining is expected to generate 0.41 times more return on investment than Shenzhen Kexin. However, Zhengzhou Coal Mining is 2.44 times less risky than Shenzhen Kexin. It trades about -0.01 of its potential returns per unit of risk. Shenzhen Kexin Communication is currently generating about -0.12 per unit of risk. If you would invest 1,338 in Zhengzhou Coal Mining on October 31, 2024 and sell it today you would lose (20.00) from holding Zhengzhou Coal Mining or give up 1.49% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Zhengzhou Coal Mining vs. Shenzhen Kexin Communication
Performance |
Timeline |
Zhengzhou Coal Mining |
Shenzhen Kexin Commu |
Zhengzhou Coal and Shenzhen Kexin Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zhengzhou Coal and Shenzhen Kexin
The main advantage of trading using opposite Zhengzhou Coal and Shenzhen Kexin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhengzhou Coal position performs unexpectedly, Shenzhen Kexin 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 Shenzhen Kexin will offset losses from the drop in Shenzhen Kexin's long position.Zhengzhou Coal vs. Andon Health Co | ||
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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