Correlation Between China Longyuan and Dalian Zeus
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By analyzing existing cross correlation between China Longyuan Power and Dalian Zeus Entertainment, you can compare the effects of market volatilities on China Longyuan and Dalian Zeus 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 China Longyuan with a short position of Dalian Zeus. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Longyuan and Dalian Zeus.
Diversification Opportunities for China Longyuan and Dalian Zeus
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Dalian is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding China Longyuan Power and Dalian Zeus Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dalian Zeus Entertainment and China Longyuan 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 China Longyuan Power are associated (or correlated) with Dalian Zeus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dalian Zeus Entertainment has no effect on the direction of China Longyuan i.e., China Longyuan and Dalian Zeus go up and down completely randomly.
Pair Corralation between China Longyuan and Dalian Zeus
Assuming the 90 days trading horizon China Longyuan is expected to generate 12.38 times less return on investment than Dalian Zeus. But when comparing it to its historical volatility, China Longyuan Power is 2.13 times less risky than Dalian Zeus. It trades about 0.01 of its potential returns per unit of risk. Dalian Zeus Entertainment is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 410.00 in Dalian Zeus Entertainment on September 12, 2024 and sell it today you would earn a total of 338.00 from holding Dalian Zeus Entertainment or generate 82.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Longyuan Power vs. Dalian Zeus Entertainment
Performance |
| Timeline |
| China Longyuan Power |
| Dalian Zeus Entertainment |
China Longyuan and Dalian Zeus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Longyuan and Dalian Zeus
The main advantage of trading using opposite China Longyuan and Dalian Zeus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Longyuan position performs unexpectedly, Dalian Zeus 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 Dalian Zeus will offset losses from the drop in Dalian Zeus' long position.| China Longyuan vs. Gansu Jiu Steel | China Longyuan vs. Shandong Mining Machinery | China Longyuan vs. Aba Chemicals Corp | China Longyuan vs. BlueFocus Communication Group |
| Dalian Zeus vs. Kweichow Moutai Co | Dalian Zeus vs. Shenzhen Mindray Bio Medical | Dalian Zeus vs. G bits Network Technology | Dalian Zeus vs. Beijing Roborock Technology |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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