Correlation Between Zhejiang Qianjiang and Anhui Gujing
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By analyzing existing cross correlation between Zhejiang Qianjiang Motorcycle and Anhui Gujing Distillery, you can compare the effects of market volatilities on Zhejiang Qianjiang and Anhui Gujing 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 Zhejiang Qianjiang with a short position of Anhui Gujing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Qianjiang and Anhui Gujing.
Diversification Opportunities for Zhejiang Qianjiang and Anhui Gujing
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Zhejiang and Anhui is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Qianjiang Motorcycle and Anhui Gujing Distillery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Gujing Distillery and Zhejiang Qianjiang 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 Zhejiang Qianjiang Motorcycle are associated (or correlated) with Anhui Gujing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Gujing Distillery has no effect on the direction of Zhejiang Qianjiang i.e., Zhejiang Qianjiang and Anhui Gujing go up and down completely randomly.
Pair Corralation between Zhejiang Qianjiang and Anhui Gujing
Assuming the 90 days trading horizon Zhejiang Qianjiang Motorcycle is expected to generate 2.65 times more return on investment than Anhui Gujing. However, Zhejiang Qianjiang is 2.65 times more volatile than Anhui Gujing Distillery. It trades about 0.17 of its potential returns per unit of risk. Anhui Gujing Distillery is currently generating about 0.06 per unit of risk. If you would invest 1,649 in Zhejiang Qianjiang Motorcycle on October 30, 2024 and sell it today you would earn a total of 343.00 from holding Zhejiang Qianjiang Motorcycle or generate 20.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Qianjiang Motorcycle vs. Anhui Gujing Distillery
Performance |
| Timeline |
| Zhejiang Qianjiang |
| Anhui Gujing Distillery |
Zhejiang Qianjiang and Anhui Gujing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Qianjiang and Anhui Gujing
The main advantage of trading using opposite Zhejiang Qianjiang and Anhui Gujing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Qianjiang position performs unexpectedly, Anhui Gujing 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 Anhui Gujing will offset losses from the drop in Anhui Gujing's long position.| Zhejiang Qianjiang vs. Industrial and Commercial | Zhejiang Qianjiang vs. China Construction Bank | Zhejiang Qianjiang vs. Agricultural Bank of | Zhejiang Qianjiang vs. Bank of China |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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