Correlation Between Zhongrun Resources and Huatian Hotel
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By analyzing existing cross correlation between Zhongrun Resources Investment and Huatian Hotel Group, you can compare the effects of market volatilities on Zhongrun Resources and Huatian Hotel 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 Zhongrun Resources with a short position of Huatian Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongrun Resources and Huatian Hotel.
Diversification Opportunities for Zhongrun Resources and Huatian Hotel
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhongrun and Huatian is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Zhongrun Resources Investment and Huatian Hotel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huatian Hotel Group and Zhongrun Resources 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 Zhongrun Resources Investment are associated (or correlated) with Huatian Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huatian Hotel Group has no effect on the direction of Zhongrun Resources i.e., Zhongrun Resources and Huatian Hotel go up and down completely randomly.
Pair Corralation between Zhongrun Resources and Huatian Hotel
Assuming the 90 days trading horizon Zhongrun Resources Investment is expected to generate 1.44 times more return on investment than Huatian Hotel. However, Zhongrun Resources is 1.44 times more volatile than Huatian Hotel Group. It trades about 0.19 of its potential returns per unit of risk. Huatian Hotel Group is currently generating about 0.02 per unit of risk. If you would invest 301.00 in Zhongrun Resources Investment on September 3, 2024 and sell it today you would earn a total of 52.00 from holding Zhongrun Resources Investment or generate 17.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongrun Resources Investment vs. Huatian Hotel Group
Performance |
| Timeline |
| Zhongrun Resources |
| Huatian Hotel Group |
Zhongrun Resources and Huatian Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongrun Resources and Huatian Hotel
The main advantage of trading using opposite Zhongrun Resources and Huatian Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongrun Resources position performs unexpectedly, Huatian Hotel 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 Huatian Hotel will offset losses from the drop in Huatian Hotel's long position.| Zhongrun Resources vs. Industrial and Commercial | Zhongrun Resources vs. China Construction Bank | Zhongrun Resources vs. Bank of China | Zhongrun Resources vs. Agricultural Bank of |
| Huatian Hotel vs. PetroChina Co Ltd | Huatian Hotel vs. China Mobile Limited | Huatian Hotel vs. Industrial and Commercial | Huatian Hotel vs. China Life Insurance |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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