Correlation Between Zhejiang JIULI and Industrial
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By analyzing existing cross correlation between Zhejiang JIULI Hi tech and Industrial and Commercial, you can compare the effects of market volatilities on Zhejiang JIULI and Industrial 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 Zhejiang JIULI with a short position of Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang JIULI and Industrial.
Diversification Opportunities for Zhejiang JIULI and Industrial
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Zhejiang and Industrial is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang JIULI Hi tech and Industrial and Commercial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial and Commercial and Zhejiang JIULI 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 Zhejiang JIULI Hi tech are associated (or correlated) with Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial and Commercial has no effect on the direction of Zhejiang JIULI i.e., Zhejiang JIULI and Industrial go up and down completely randomly.
Pair Corralation between Zhejiang JIULI and Industrial
Assuming the 90 days trading horizon Zhejiang JIULI is expected to generate 1.1 times less return on investment than Industrial. In addition to that, Zhejiang JIULI is 1.47 times more volatile than Industrial and Commercial. It trades about 0.06 of its total potential returns per unit of risk. Industrial and Commercial is currently generating about 0.1 per unit of volatility. If you would invest 401.00 in Industrial and Commercial on November 7, 2024 and sell it today you would earn a total of 281.00 from holding Industrial and Commercial or generate 70.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang JIULI Hi tech vs. Industrial and Commercial
Performance |
| Timeline |
| Zhejiang JIULI Hi |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| Industrial and Commercial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Zhejiang JIULI and Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang JIULI and Industrial
The main advantage of trading using opposite Zhejiang JIULI and Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang JIULI position performs unexpectedly, Industrial 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 Industrial will offset losses from the drop in Industrial's long position.The idea behind Zhejiang JIULI Hi tech and Industrial and Commercial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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