Correlation Between ZYF Lopsking and Chongqing Shunbo
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By analyzing existing cross correlation between ZYF Lopsking Aluminum and Chongqing Shunbo Aluminum, you can compare the effects of market volatilities on ZYF Lopsking and Chongqing Shunbo 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 ZYF Lopsking with a short position of Chongqing Shunbo. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZYF Lopsking and Chongqing Shunbo.
Diversification Opportunities for ZYF Lopsking and Chongqing Shunbo
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ZYF and Chongqing is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding ZYF Lopsking Aluminum and Chongqing Shunbo Aluminum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Shunbo Aluminum and ZYF Lopsking 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 ZYF Lopsking Aluminum are associated (or correlated) with Chongqing Shunbo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Shunbo Aluminum has no effect on the direction of ZYF Lopsking i.e., ZYF Lopsking and Chongqing Shunbo go up and down completely randomly.
Pair Corralation between ZYF Lopsking and Chongqing Shunbo
Assuming the 90 days trading horizon ZYF Lopsking is expected to generate 4.72 times less return on investment than Chongqing Shunbo. But when comparing it to its historical volatility, ZYF Lopsking Aluminum is 1.27 times less risky than Chongqing Shunbo. It trades about 0.04 of its potential returns per unit of risk. Chongqing Shunbo Aluminum is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 610.00 in Chongqing Shunbo Aluminum on August 25, 2024 and sell it today you would earn a total of 46.00 from holding Chongqing Shunbo Aluminum or generate 7.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ZYF Lopsking Aluminum vs. Chongqing Shunbo Aluminum
Performance |
| Timeline |
| ZYF Lopsking Aluminum |
| Chongqing Shunbo Aluminum |
ZYF Lopsking and Chongqing Shunbo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZYF Lopsking and Chongqing Shunbo
The main advantage of trading using opposite ZYF Lopsking and Chongqing Shunbo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZYF Lopsking position performs unexpectedly, Chongqing Shunbo 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 Chongqing Shunbo will offset losses from the drop in Chongqing Shunbo's long position.| ZYF Lopsking vs. Guangzhou Automobile Group | ZYF Lopsking vs. Songz Automobile Air | ZYF Lopsking vs. Zhejiang Yongjin Metal | ZYF Lopsking vs. Anhui Jianghuai Automobile |
| Chongqing Shunbo vs. Zijin Mining Group | Chongqing Shunbo vs. Wanhua Chemical Group | Chongqing Shunbo vs. Shandong Gold Mining | Chongqing Shunbo vs. Inner Mongolia BaoTou |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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