Correlation Between Zhejiang Qianjiang and Chongqing Road
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By analyzing existing cross correlation between Zhejiang Qianjiang Motorcycle and Chongqing Road Bridge, you can compare the effects of market volatilities on Zhejiang Qianjiang and Chongqing Road 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 Chongqing Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Qianjiang and Chongqing Road.
Diversification Opportunities for Zhejiang Qianjiang and Chongqing Road
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zhejiang and Chongqing is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Qianjiang Motorcycle and Chongqing Road Bridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Road Bridge 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 Chongqing Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Road Bridge has no effect on the direction of Zhejiang Qianjiang i.e., Zhejiang Qianjiang and Chongqing Road go up and down completely randomly.
Pair Corralation between Zhejiang Qianjiang and Chongqing Road
Assuming the 90 days trading horizon Zhejiang Qianjiang is expected to generate 2.71 times less return on investment than Chongqing Road. In addition to that, Zhejiang Qianjiang is 1.0 times more volatile than Chongqing Road Bridge. It trades about 0.02 of its total potential returns per unit of risk. Chongqing Road Bridge is currently generating about 0.05 per unit of volatility. If you would invest 479.00 in Chongqing Road Bridge on September 13, 2024 and sell it today you would earn a total of 259.00 from holding Chongqing Road Bridge or generate 54.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Qianjiang Motorcycle vs. Chongqing Road Bridge
Performance |
| Timeline |
| Zhejiang Qianjiang |
| Chongqing Road Bridge |
Zhejiang Qianjiang and Chongqing Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Qianjiang and Chongqing Road
The main advantage of trading using opposite Zhejiang Qianjiang and Chongqing Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Qianjiang position performs unexpectedly, Chongqing Road 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 Chongqing Road will offset losses from the drop in Chongqing Road's long position.| Zhejiang Qianjiang vs. Xiangyu Medical Co | Zhejiang Qianjiang vs. Shenzhen Silver Basis | Zhejiang Qianjiang vs. Cowealth Medical China | Zhejiang Qianjiang vs. Shenzhen Noposion Agrochemicals |
| Chongqing Road vs. Hubeiyichang Transportation Group | Chongqing Road vs. Zhejiang Qianjiang Motorcycle | Chongqing Road vs. Dongfeng Automobile Co | Chongqing Road vs. Harbin Hatou Investment |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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