Correlation Between Zhongshan Public and Shanxi Lanhua
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By analyzing existing cross correlation between Zhongshan Public Utilities and Shanxi Lanhua Sci Tech, you can compare the effects of market volatilities on Zhongshan Public and Shanxi Lanhua 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 Zhongshan Public with a short position of Shanxi Lanhua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongshan Public and Shanxi Lanhua.
Diversification Opportunities for Zhongshan Public and Shanxi Lanhua
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Zhongshan and Shanxi is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Zhongshan Public Utilities and Shanxi Lanhua Sci Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanxi Lanhua Sci and Zhongshan Public 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 Zhongshan Public Utilities are associated (or correlated) with Shanxi Lanhua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanxi Lanhua Sci has no effect on the direction of Zhongshan Public i.e., Zhongshan Public and Shanxi Lanhua go up and down completely randomly.
Pair Corralation between Zhongshan Public and Shanxi Lanhua
Assuming the 90 days trading horizon Zhongshan Public Utilities is expected to generate 0.78 times more return on investment than Shanxi Lanhua. However, Zhongshan Public Utilities is 1.27 times less risky than Shanxi Lanhua. It trades about 0.21 of its potential returns per unit of risk. Shanxi Lanhua Sci Tech is currently generating about 0.04 per unit of risk. If you would invest 891.00 in Zhongshan Public Utilities on September 30, 2024 and sell it today you would earn a total of 56.00 from holding Zhongshan Public Utilities or generate 6.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongshan Public Utilities vs. Shanxi Lanhua Sci Tech
Performance |
| Timeline |
| Zhongshan Public Uti |
| Shanxi Lanhua Sci |
Zhongshan Public and Shanxi Lanhua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongshan Public and Shanxi Lanhua
The main advantage of trading using opposite Zhongshan Public and Shanxi Lanhua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongshan Public position performs unexpectedly, Shanxi Lanhua 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 Shanxi Lanhua will offset losses from the drop in Shanxi Lanhua's long position.| Zhongshan Public vs. Digital China Information | Zhongshan Public vs. Hubei Geoway Investment | Zhongshan Public vs. Tongding Interconnection Information | Zhongshan Public vs. Vanfund Urban Investment |
| Shanxi Lanhua vs. Zhejiang Kingland Pipeline | Shanxi Lanhua vs. Elite Color Environmental | Shanxi Lanhua vs. Shanghai Construction Group | Shanxi Lanhua vs. Keeson Technology Corp |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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