Correlation Between GRINM Semiconductor and Zoomlion Heavy

Can any of the company-specific risk be diversified away by investing in both GRINM Semiconductor and Zoomlion Heavy 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 GRINM Semiconductor and Zoomlion Heavy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GRINM Semiconductor Materials and Zoomlion Heavy Industry, you can compare the effects of market volatilities on GRINM Semiconductor and Zoomlion Heavy 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 GRINM Semiconductor with a short position of Zoomlion Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRINM Semiconductor and Zoomlion Heavy.

Diversification Opportunities for GRINM Semiconductor and Zoomlion Heavy

0.0

Correlation Coefficient

GRINM Semiconductor  Zoomlion Heavy

Pay attention - limited upside

The 3 months correlation between GRINM and Zoomlion is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GRINM Semiconductor Materials and Zoomlion Heavy Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zoomlion Heavy Industry and GRINM Semiconductor 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 GRINM Semiconductor Materials are associated (or correlated) with Zoomlion Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zoomlion Heavy Industry has no effect on the direction of GRINM Semiconductor i.e., GRINM Semiconductor and Zoomlion Heavy go up and down completely randomly.

Pair Corralation between GRINM Semiconductor and Zoomlion Heavy

If you would invest (100.00) in Zoomlion Heavy Industry on October 8, 2024 and sell it today you would earn a total of  100.00  from holding Zoomlion Heavy Industry or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

GRINM Semiconductor Materials  vs.  Zoomlion Heavy Industry

GRINM Semiconductor

Risk-Adjusted Performance

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Very Weak

Over the last 90 days GRINM Semiconductor Materials 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 February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Zoomlion Heavy Industry

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Zoomlion Heavy Industry has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Zoomlion Heavy is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with GRINM Semiconductor and Zoomlion Heavy

The main advantage of trading using opposite GRINM Semiconductor and Zoomlion Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRINM Semiconductor position performs unexpectedly, Zoomlion Heavy 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 Zoomlion Heavy will offset losses from the drop in Zoomlion Heavy's long position.

The idea behind GRINM Semiconductor Materials and Zoomlion Heavy Industry 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..