Correlation Between China Merchants and Zhejiang Tailin
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By analyzing existing cross correlation between China Merchants Shekou and Zhejiang Tailin Bioengineering, you can compare the effects of market volatilities on China Merchants and Zhejiang Tailin 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 Merchants with a short position of Zhejiang Tailin. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Merchants and Zhejiang Tailin.
Diversification Opportunities for China Merchants and Zhejiang Tailin
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Zhejiang is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding China Merchants Shekou and Zhejiang Tailin Bioengineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Tailin Bioe and China Merchants 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 Merchants Shekou are associated (or correlated) with Zhejiang Tailin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Tailin Bioe has no effect on the direction of China Merchants i.e., China Merchants and Zhejiang Tailin go up and down completely randomly.
Pair Corralation between China Merchants and Zhejiang Tailin
Assuming the 90 days trading horizon China Merchants Shekou is expected to generate 0.72 times more return on investment than Zhejiang Tailin. However, China Merchants Shekou is 1.39 times less risky than Zhejiang Tailin. It trades about -0.01 of its potential returns per unit of risk. Zhejiang Tailin Bioengineering is currently generating about -0.02 per unit of risk. If you would invest 1,367 in China Merchants Shekou on October 16, 2024 and sell it today you would lose (358.00) from holding China Merchants Shekou or give up 26.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Merchants Shekou vs. Zhejiang Tailin Bioengineering
Performance |
| Timeline |
| China Merchants Shekou |
| Zhejiang Tailin Bioe |
China Merchants and Zhejiang Tailin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Merchants and Zhejiang Tailin
The main advantage of trading using opposite China Merchants and Zhejiang Tailin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Merchants position performs unexpectedly, Zhejiang Tailin 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 Tailin will offset losses from the drop in Zhejiang Tailin's long position.| China Merchants vs. Nanxing Furniture Machinery | China Merchants vs. Long Yuan Construction | China Merchants vs. Hainan Mining Co | China Merchants vs. Shaanxi Construction Machinery |
| Zhejiang Tailin vs. Southern PublishingMedia Co | Zhejiang Tailin vs. Beijing Kaiwen Education | Zhejiang Tailin vs. Heilongjiang Publishing Media | Zhejiang Tailin vs. Beijing Mainstreets 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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