Correlation Between Zhongtong Guomai and Sinomach Automobile
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By analyzing existing cross correlation between Zhongtong Guomai Communication and Sinomach Automobile Co, you can compare the effects of market volatilities on Zhongtong Guomai and Sinomach Automobile 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 Zhongtong Guomai with a short position of Sinomach Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongtong Guomai and Sinomach Automobile.
Diversification Opportunities for Zhongtong Guomai and Sinomach Automobile
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhongtong and Sinomach is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Zhongtong Guomai Communication and Sinomach Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinomach Automobile and Zhongtong Guomai 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 Zhongtong Guomai Communication are associated (or correlated) with Sinomach Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinomach Automobile has no effect on the direction of Zhongtong Guomai i.e., Zhongtong Guomai and Sinomach Automobile go up and down completely randomly.
Pair Corralation between Zhongtong Guomai and Sinomach Automobile
Assuming the 90 days trading horizon Zhongtong Guomai Communication is expected to generate 1.47 times more return on investment than Sinomach Automobile. However, Zhongtong Guomai is 1.47 times more volatile than Sinomach Automobile Co. It trades about 0.19 of its potential returns per unit of risk. Sinomach Automobile Co is currently generating about 0.15 per unit of risk. If you would invest 763.00 in Zhongtong Guomai Communication on September 7, 2024 and sell it today you would earn a total of 386.00 from holding Zhongtong Guomai Communication or generate 50.59% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Zhongtong Guomai Communication vs. Sinomach Automobile Co
Performance |
Timeline |
Zhongtong Guomai Com |
Sinomach Automobile |
Zhongtong Guomai and Sinomach Automobile Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zhongtong Guomai and Sinomach Automobile
The main advantage of trading using opposite Zhongtong Guomai and Sinomach Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongtong Guomai position performs unexpectedly, Sinomach Automobile 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 Sinomach Automobile will offset losses from the drop in Sinomach Automobile's long position.Zhongtong Guomai vs. China Sports Industry | Zhongtong Guomai vs. Anhui Deli Household | Zhongtong Guomai vs. Nanjing Putian Telecommunications | Zhongtong Guomai vs. Lander Sports Development |
Sinomach Automobile vs. Guangdong Shenglu Telecommunication | Sinomach Automobile vs. Hunan Mendale Hometextile | Sinomach Automobile vs. Oppein Home Group | Sinomach Automobile vs. Vohringer Home Technology |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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