Correlation Between Zhejiang Qianjiang and Xiamen Goldenhome
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By analyzing existing cross correlation between Zhejiang Qianjiang Motorcycle and Xiamen Goldenhome Co, you can compare the effects of market volatilities on Zhejiang Qianjiang and Xiamen Goldenhome 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 Xiamen Goldenhome. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Qianjiang and Xiamen Goldenhome.
Diversification Opportunities for Zhejiang Qianjiang and Xiamen Goldenhome
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Zhejiang and Xiamen is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Qianjiang Motorcycle and Xiamen Goldenhome Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Goldenhome 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 Xiamen Goldenhome. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Goldenhome has no effect on the direction of Zhejiang Qianjiang i.e., Zhejiang Qianjiang and Xiamen Goldenhome go up and down completely randomly.
Pair Corralation between Zhejiang Qianjiang and Xiamen Goldenhome
Assuming the 90 days trading horizon Zhejiang Qianjiang Motorcycle is expected to generate 1.08 times more return on investment than Xiamen Goldenhome. However, Zhejiang Qianjiang is 1.08 times more volatile than Xiamen Goldenhome Co. It trades about -0.01 of its potential returns per unit of risk. Xiamen Goldenhome Co is currently generating about -0.03 per unit of risk. If you would invest 2,346 in Zhejiang Qianjiang Motorcycle on October 16, 2024 and sell it today you would lose (698.00) from holding Zhejiang Qianjiang Motorcycle or give up 29.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Qianjiang Motorcycle vs. Xiamen Goldenhome Co
Performance |
| Timeline |
| Zhejiang Qianjiang |
| Xiamen Goldenhome |
Zhejiang Qianjiang and Xiamen Goldenhome Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Qianjiang and Xiamen Goldenhome
The main advantage of trading using opposite Zhejiang Qianjiang and Xiamen Goldenhome positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Qianjiang position performs unexpectedly, Xiamen Goldenhome 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 Xiamen Goldenhome will offset losses from the drop in Xiamen Goldenhome's long position.| Zhejiang Qianjiang vs. Shandong Sanyuan Biotechnology | Zhejiang Qianjiang vs. Shenzhen Bioeasy Biotechnology | Zhejiang Qianjiang vs. Ligao Foods CoLtd | Zhejiang Qianjiang vs. Shanghai Ziyan Foods |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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