Correlation Between ZJBC Information and Weichai Heavy
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By analyzing existing cross correlation between ZJBC Information Technology and Weichai Heavy Machinery, you can compare the effects of market volatilities on ZJBC Information and Weichai Heavy 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 ZJBC Information with a short position of Weichai Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZJBC Information and Weichai Heavy.
Diversification Opportunities for ZJBC Information and Weichai Heavy
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ZJBC and Weichai is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding ZJBC Information Technology and Weichai Heavy Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weichai Heavy Machinery and ZJBC Information 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 ZJBC Information Technology are associated (or correlated) with Weichai Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weichai Heavy Machinery has no effect on the direction of ZJBC Information i.e., ZJBC Information and Weichai Heavy go up and down completely randomly.
Pair Corralation between ZJBC Information and Weichai Heavy
Assuming the 90 days trading horizon ZJBC Information is expected to generate 1.27 times less return on investment than Weichai Heavy. In addition to that, ZJBC Information is 1.03 times more volatile than Weichai Heavy Machinery. It trades about 0.03 of its total potential returns per unit of risk. Weichai Heavy Machinery is currently generating about 0.04 per unit of volatility. If you would invest 915.00 in Weichai Heavy Machinery on August 28, 2024 and sell it today you would earn a total of 387.00 from holding Weichai Heavy Machinery or generate 42.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ZJBC Information Technology vs. Weichai Heavy Machinery
Performance |
| Timeline |
| ZJBC Information Tec |
| Weichai Heavy Machinery |
ZJBC Information and Weichai Heavy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZJBC Information and Weichai Heavy
The main advantage of trading using opposite ZJBC Information and Weichai Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZJBC Information position performs unexpectedly, Weichai Heavy 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 Weichai Heavy will offset losses from the drop in Weichai Heavy's long position.| ZJBC Information vs. China Petroleum Chemical | ZJBC Information vs. PetroChina Co Ltd | ZJBC Information vs. China State Construction | ZJBC Information vs. China Railway Group |
| Weichai Heavy vs. China Asset Management | Weichai Heavy vs. Harvest Fund Management | Weichai Heavy vs. JCHX Mining Management | Weichai Heavy vs. AVIC Fund Management |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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