Correlation Between SAI Old and Zhong Yang

Can any of the company-specific risk be diversified away by investing in both SAI Old and Zhong Yang 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 SAI Old and Zhong Yang into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SAI Old and Zhong Yang Financial, you can compare the effects of market volatilities on SAI Old and Zhong Yang 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 SAI Old with a short position of Zhong Yang. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAI Old and Zhong Yang.

Diversification Opportunities for SAI Old and Zhong Yang

-0.26

Correlation Coefficient

SAI Old  Zhong Yang

Very good diversification

The 3 months correlation between SAI and Zhong is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding SAI Old and Zhong Yang Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhong Yang Financial and SAI Old 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 SAI Old are associated (or correlated) with Zhong Yang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhong Yang Financial has no effect on the direction of SAI Old i.e., SAI Old and Zhong Yang go up and down completely randomly.

Pair Corralation between SAI Old and Zhong Yang

If you would invest  117.00  in SAI Old on October 10, 2024 and sell it today you would earn a total of  0.00  from holding SAI Old or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

SAI Old  vs.  Zhong Yang Financial

SAI Old

Risk-Adjusted Performance

0 of 100

Solid

Over the last 90 days SAI Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly weak basic indicators, SAI Old demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Zhong Yang Financial

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Zhong Yang Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Even with conflicting performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with SAI Old and Zhong Yang

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

The idea behind SAI Old and Zhong Yang Financial 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.