Correlation Between Zoomlion Heavy and Bank of China
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By analyzing existing cross correlation between Zoomlion Heavy Industry and Bank of China, you can compare the effects of market volatilities on Zoomlion Heavy and Bank of China 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 Zoomlion Heavy with a short position of Bank of China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zoomlion Heavy and Bank of China.
Diversification Opportunities for Zoomlion Heavy and Bank of China
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Zoomlion and Bank is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Zoomlion Heavy Industry and Bank of China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of China and Zoomlion Heavy 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 Zoomlion Heavy Industry are associated (or correlated) with Bank of China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of China has no effect on the direction of Zoomlion Heavy i.e., Zoomlion Heavy and Bank of China go up and down completely randomly.
Pair Corralation between Zoomlion Heavy and Bank of China
Assuming the 90 days trading horizon Zoomlion Heavy is expected to generate 4.47 times less return on investment than Bank of China. In addition to that, Zoomlion Heavy is 1.33 times more volatile than Bank of China. It trades about 0.07 of its total potential returns per unit of risk. Bank of China is currently generating about 0.44 per unit of volatility. If you would invest 504.00 in Bank of China on September 28, 2024 and sell it today you would earn a total of 46.00 from holding Bank of China or generate 9.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zoomlion Heavy Industry vs. Bank of China
Performance |
| Timeline |
| Zoomlion Heavy Industry |
| Bank of China |
Zoomlion Heavy and Bank of China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zoomlion Heavy and Bank of China
The main advantage of trading using opposite Zoomlion Heavy and Bank of China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zoomlion Heavy position performs unexpectedly, Bank of China 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 Bank of China will offset losses from the drop in Bank of China's long position.| Zoomlion Heavy vs. Industrial and Commercial | Zoomlion Heavy vs. Agricultural Bank of | Zoomlion Heavy vs. China Construction Bank | Zoomlion Heavy vs. Bank of China |
| Bank of China vs. Industrial and Commercial | Bank of China vs. Kweichow Moutai Co | Bank of China vs. Agricultural Bank of | Bank of China vs. China Mobile Limited |
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 Stocks Directory module to find actively traded stocks across global markets.
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