Correlation Between China Vanke and Zhongfu Information
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By analyzing existing cross correlation between China Vanke Co and Zhongfu Information, you can compare the effects of market volatilities on China Vanke and Zhongfu Information 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 China Vanke with a short position of Zhongfu Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Vanke and Zhongfu Information.
Diversification Opportunities for China Vanke and Zhongfu Information
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Zhongfu is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding China Vanke Co and Zhongfu Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongfu Information and China Vanke 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 China Vanke Co are associated (or correlated) with Zhongfu Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongfu Information has no effect on the direction of China Vanke i.e., China Vanke and Zhongfu Information go up and down completely randomly.
Pair Corralation between China Vanke and Zhongfu Information
Assuming the 90 days trading horizon China Vanke Co is expected to under-perform the Zhongfu Information. But the stock apears to be less risky and, when comparing its historical volatility, China Vanke Co is 1.63 times less risky than Zhongfu Information. The stock trades about -0.05 of its potential returns per unit of risk. The Zhongfu Information is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 3,108 in Zhongfu Information on October 29, 2024 and sell it today you would lose (1,446) from holding Zhongfu Information or give up 46.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Vanke Co vs. Zhongfu Information
Performance |
| Timeline |
| China Vanke |
| Zhongfu Information |
China Vanke and Zhongfu Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Vanke and Zhongfu Information
The main advantage of trading using opposite China Vanke and Zhongfu Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Vanke position performs unexpectedly, Zhongfu Information 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 Zhongfu Information will offset losses from the drop in Zhongfu Information's long position.| China Vanke vs. Heilongjiang Transport Development | China Vanke vs. China Aluminum International | China Vanke vs. Anhui Transport Consulting | China Vanke vs. Semiconductor Manufacturing Electronics |
| Zhongfu Information vs. Shanghai Ziyan Foods | Zhongfu Information vs. Sichuan Fulin Transportation | Zhongfu Information vs. Ligao Foods CoLtd | Zhongfu Information vs. Guilin Seamild Foods |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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