Correlation Between Zhongshan Public and Tonghua Grape
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By analyzing existing cross correlation between Zhongshan Public Utilities and Tonghua Grape Wine, you can compare the effects of market volatilities on Zhongshan Public and Tonghua Grape 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 Tonghua Grape. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongshan Public and Tonghua Grape.
Diversification Opportunities for Zhongshan Public and Tonghua Grape
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zhongshan and Tonghua is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Zhongshan Public Utilities and Tonghua Grape Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tonghua Grape Wine 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 Tonghua Grape. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tonghua Grape Wine has no effect on the direction of Zhongshan Public i.e., Zhongshan Public and Tonghua Grape go up and down completely randomly.
Pair Corralation between Zhongshan Public and Tonghua Grape
Assuming the 90 days trading horizon Zhongshan Public Utilities is expected to generate 0.64 times more return on investment than Tonghua Grape. However, Zhongshan Public Utilities is 1.55 times less risky than Tonghua Grape. It trades about 0.03 of its potential returns per unit of risk. Tonghua Grape Wine is currently generating about -0.06 per unit of risk. If you would invest 863.00 in Zhongshan Public Utilities on November 6, 2024 and sell it today you would earn a total of 16.00 from holding Zhongshan Public Utilities or generate 1.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongshan Public Utilities vs. Tonghua Grape Wine
Performance |
| Timeline |
| Zhongshan Public Uti |
| Tonghua Grape Wine |
Zhongshan Public and Tonghua Grape Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongshan Public and Tonghua Grape
The main advantage of trading using opposite Zhongshan Public and Tonghua Grape positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongshan Public position performs unexpectedly, Tonghua Grape 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 Tonghua Grape will offset losses from the drop in Tonghua Grape's long position.| Zhongshan Public vs. Jiajia Food Group | Zhongshan Public vs. Zhongyin Babi Food | Zhongshan Public vs. Eastern Communications Co | Zhongshan Public vs. Jilin Jlu Communication |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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