Correlation Between Cangzhou Mingzhu and Zhongshan Public
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By analyzing existing cross correlation between Cangzhou Mingzhu Plastic and Zhongshan Public Utilities, you can compare the effects of market volatilities on Cangzhou Mingzhu and Zhongshan Public 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 Cangzhou Mingzhu with a short position of Zhongshan Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cangzhou Mingzhu and Zhongshan Public.
Diversification Opportunities for Cangzhou Mingzhu and Zhongshan Public
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cangzhou and Zhongshan is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Cangzhou Mingzhu Plastic and Zhongshan Public Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongshan Public Uti and Cangzhou Mingzhu 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 Cangzhou Mingzhu Plastic are associated (or correlated) with Zhongshan Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongshan Public Uti has no effect on the direction of Cangzhou Mingzhu i.e., Cangzhou Mingzhu and Zhongshan Public go up and down completely randomly.
Pair Corralation between Cangzhou Mingzhu and Zhongshan Public
Assuming the 90 days trading horizon Cangzhou Mingzhu Plastic is expected to generate 1.96 times more return on investment than Zhongshan Public. However, Cangzhou Mingzhu is 1.96 times more volatile than Zhongshan Public Utilities. It trades about 0.14 of its potential returns per unit of risk. Zhongshan Public Utilities is currently generating about 0.09 per unit of risk. If you would invest 366.00 in Cangzhou Mingzhu Plastic on September 14, 2024 and sell it today you would earn a total of 33.00 from holding Cangzhou Mingzhu Plastic or generate 9.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cangzhou Mingzhu Plastic vs. Zhongshan Public Utilities
Performance |
| Timeline |
| Cangzhou Mingzhu Plastic |
| Zhongshan Public Uti |
Cangzhou Mingzhu and Zhongshan Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cangzhou Mingzhu and Zhongshan Public
The main advantage of trading using opposite Cangzhou Mingzhu and Zhongshan Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cangzhou Mingzhu position performs unexpectedly, Zhongshan Public 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 Zhongshan Public will offset losses from the drop in Zhongshan Public's long position.| Cangzhou Mingzhu vs. Zhejiang Kingland Pipeline | Cangzhou Mingzhu vs. Glodon Software Co | Cangzhou Mingzhu vs. CITIC Securities Co | Cangzhou Mingzhu vs. Shanghai Suochen Information |
| Zhongshan Public vs. Biwin Storage Technology | Zhongshan Public vs. PetroChina Co Ltd | Zhongshan Public vs. Industrial and Commercial | Zhongshan Public vs. China Construction Bank |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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