Correlation Between Zhejiang Huayou and China Marine
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By analyzing existing cross correlation between Zhejiang Huayou Cobalt and China Marine Information, you can compare the effects of market volatilities on Zhejiang Huayou and China Marine 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 Huayou with a short position of China Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Huayou and China Marine.
Diversification Opportunities for Zhejiang Huayou and China Marine
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhejiang and China is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Huayou Cobalt and China Marine Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Marine Information and Zhejiang Huayou 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 Huayou Cobalt are associated (or correlated) with China Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Marine Information has no effect on the direction of Zhejiang Huayou i.e., Zhejiang Huayou and China Marine go up and down completely randomly.
Pair Corralation between Zhejiang Huayou and China Marine
Assuming the 90 days trading horizon Zhejiang Huayou Cobalt is expected to under-perform the China Marine. But the stock apears to be less risky and, when comparing its historical volatility, Zhejiang Huayou Cobalt is 1.04 times less risky than China Marine. The stock trades about -0.04 of its potential returns per unit of risk. The China Marine Information is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,341 in China Marine Information on September 26, 2024 and sell it today you would earn a total of 573.00 from holding China Marine Information or generate 24.48% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 99.79% |
Values | Daily Returns |
Zhejiang Huayou Cobalt vs. China Marine Information
Performance |
Timeline |
Zhejiang Huayou Cobalt |
China Marine Information |
Zhejiang Huayou and China Marine Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zhejiang Huayou and China Marine
The main advantage of trading using opposite Zhejiang Huayou and China Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Huayou position performs unexpectedly, China Marine 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 Marine will offset losses from the drop in China Marine's long position.Zhejiang Huayou vs. Zijin Mining Group | Zhejiang Huayou vs. Wanhua Chemical Group | Zhejiang Huayou vs. Baoshan Iron Steel | Zhejiang Huayou vs. Shandong Gold Mining |
China Marine vs. Tianjin Pengling Rubber | China Marine vs. Guangzhou Tinci Materials | China Marine vs. Ningxia Building Materials | China Marine vs. Jiugui Liquor Co |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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