Correlation Between Cofco Biochemical and Zhejiang Dahua
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By analyzing existing cross correlation between Cofco Biochemical Anhui and Zhejiang Dahua Technology, you can compare the effects of market volatilities on Cofco Biochemical and Zhejiang Dahua 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 Cofco Biochemical with a short position of Zhejiang Dahua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cofco Biochemical and Zhejiang Dahua.
Diversification Opportunities for Cofco Biochemical and Zhejiang Dahua
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cofco and Zhejiang is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Cofco Biochemical Anhui and Zhejiang Dahua Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Dahua Technology and Cofco Biochemical 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 Cofco Biochemical Anhui are associated (or correlated) with Zhejiang Dahua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Dahua Technology has no effect on the direction of Cofco Biochemical i.e., Cofco Biochemical and Zhejiang Dahua go up and down completely randomly.
Pair Corralation between Cofco Biochemical and Zhejiang Dahua
Assuming the 90 days trading horizon Cofco Biochemical Anhui is expected to under-perform the Zhejiang Dahua. But the stock apears to be less risky and, when comparing its historical volatility, Cofco Biochemical Anhui is 1.62 times less risky than Zhejiang Dahua. The stock trades about -0.02 of its potential returns per unit of risk. The Zhejiang Dahua Technology is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,096 in Zhejiang Dahua Technology on September 13, 2024 and sell it today you would earn a total of 598.00 from holding Zhejiang Dahua Technology or generate 54.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cofco Biochemical Anhui vs. Zhejiang Dahua Technology
Performance |
| Timeline |
| Cofco Biochemical Anhui |
| Zhejiang Dahua Technology |
Cofco Biochemical and Zhejiang Dahua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cofco Biochemical and Zhejiang Dahua
The main advantage of trading using opposite Cofco Biochemical and Zhejiang Dahua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cofco Biochemical position performs unexpectedly, Zhejiang Dahua 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 Zhejiang Dahua will offset losses from the drop in Zhejiang Dahua's long position.| Cofco Biochemical vs. Zijin Mining Group | Cofco Biochemical vs. Wanhua Chemical Group | Cofco Biochemical vs. Baoshan Iron Steel | Cofco Biochemical vs. Shandong Gold Mining |
| Zhejiang Dahua vs. Miracll Chemicals Co | Zhejiang Dahua vs. Cofco Biochemical Anhui | Zhejiang Dahua vs. Shenzhen Noposion Agrochemicals | Zhejiang Dahua vs. Hubei Dinglong Chemical |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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