Correlation Between Hunan Investment and Zhejiang Construction
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By analyzing existing cross correlation between Hunan Investment Group and Zhejiang Construction Investment, you can compare the effects of market volatilities on Hunan Investment and Zhejiang Construction 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 Hunan Investment with a short position of Zhejiang Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunan Investment and Zhejiang Construction.
Diversification Opportunities for Hunan Investment and Zhejiang Construction
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hunan and Zhejiang is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Hunan Investment Group and Zhejiang Construction Investme in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Construction and Hunan Investment 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 Hunan Investment Group are associated (or correlated) with Zhejiang Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Construction has no effect on the direction of Hunan Investment i.e., Hunan Investment and Zhejiang Construction go up and down completely randomly.
Pair Corralation between Hunan Investment and Zhejiang Construction
Assuming the 90 days trading horizon Hunan Investment Group is expected to generate 0.9 times more return on investment than Zhejiang Construction. However, Hunan Investment Group is 1.11 times less risky than Zhejiang Construction. It trades about 0.03 of its potential returns per unit of risk. Zhejiang Construction Investment is currently generating about 0.02 per unit of risk. If you would invest 561.00 in Hunan Investment Group on September 14, 2024 and sell it today you would earn a total of 54.00 from holding Hunan Investment Group or generate 9.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.58% |
| Values | Daily Returns |
Hunan Investment Group vs. Zhejiang Construction Investme
Performance |
| Timeline |
| Hunan Investment |
| Zhejiang Construction |
Hunan Investment and Zhejiang Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hunan Investment and Zhejiang Construction
The main advantage of trading using opposite Hunan Investment and Zhejiang Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunan Investment position performs unexpectedly, Zhejiang Construction 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 Zhejiang Construction will offset losses from the drop in Zhejiang Construction's long position.| Hunan Investment vs. Kweichow Moutai Co | Hunan Investment vs. Jiangsu Pacific Quartz | Hunan Investment vs. Shenzhen Transsion Holdings | Hunan Investment vs. Beijing Roborock Technology |
| Zhejiang Construction vs. Sinomach General Machinery | Zhejiang Construction vs. Qijing Machinery | Zhejiang Construction vs. Hangzhou Pinming Software | Zhejiang Construction vs. Panda Financial Holding |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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