Correlation Between Zotye Automobile and Heilongjiang Transport
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By analyzing existing cross correlation between Zotye Automobile Co and Heilongjiang Transport Development, you can compare the effects of market volatilities on Zotye Automobile and Heilongjiang Transport 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 Zotye Automobile with a short position of Heilongjiang Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zotye Automobile and Heilongjiang Transport.
Diversification Opportunities for Zotye Automobile and Heilongjiang Transport
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Zotye and Heilongjiang is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Zotye Automobile Co and Heilongjiang Transport Develop in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heilongjiang Transport and Zotye Automobile 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 Zotye Automobile Co are associated (or correlated) with Heilongjiang Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heilongjiang Transport has no effect on the direction of Zotye Automobile i.e., Zotye Automobile and Heilongjiang Transport go up and down completely randomly.
Pair Corralation between Zotye Automobile and Heilongjiang Transport
Assuming the 90 days trading horizon Zotye Automobile Co is expected to generate 1.6 times more return on investment than Heilongjiang Transport. However, Zotye Automobile is 1.6 times more volatile than Heilongjiang Transport Development. It trades about 0.07 of its potential returns per unit of risk. Heilongjiang Transport Development is currently generating about 0.03 per unit of risk. If you would invest 192.00 in Zotye Automobile Co on August 25, 2024 and sell it today you would earn a total of 65.00 from holding Zotye Automobile Co or generate 33.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zotye Automobile Co vs. Heilongjiang Transport Develop
Performance |
| Timeline |
| Zotye Automobile |
| Heilongjiang Transport |
Zotye Automobile and Heilongjiang Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zotye Automobile and Heilongjiang Transport
The main advantage of trading using opposite Zotye Automobile and Heilongjiang Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zotye Automobile position performs unexpectedly, Heilongjiang Transport 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 Heilongjiang Transport will offset losses from the drop in Heilongjiang Transport's long position.| Zotye Automobile vs. Success Electronics | Zotye Automobile vs. Xiandai Investment Co | Zotye Automobile vs. Servyou Software Group | Zotye Automobile vs. Kunwu Jiuding Investment |
| Heilongjiang Transport vs. Jiangxi Naipu Mining | Heilongjiang Transport vs. Western Mining Co | Heilongjiang Transport vs. Lingyuan Iron Steel | Heilongjiang Transport vs. Chengtun Mining Group |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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