Correlation Between Longxing Chemical and Zhonghong Pulin
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By analyzing existing cross correlation between Longxing Chemical Stock and Zhonghong Pulin Medical, you can compare the effects of market volatilities on Longxing Chemical and Zhonghong Pulin 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 Longxing Chemical with a short position of Zhonghong Pulin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Longxing Chemical and Zhonghong Pulin.
Diversification Opportunities for Longxing Chemical and Zhonghong Pulin
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Longxing and Zhonghong is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Longxing Chemical Stock and Zhonghong Pulin Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhonghong Pulin Medical and Longxing Chemical 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 Longxing Chemical Stock are associated (or correlated) with Zhonghong Pulin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhonghong Pulin Medical has no effect on the direction of Longxing Chemical i.e., Longxing Chemical and Zhonghong Pulin go up and down completely randomly.
Pair Corralation between Longxing Chemical and Zhonghong Pulin
Assuming the 90 days trading horizon Longxing Chemical Stock is expected to generate 1.78 times more return on investment than Zhonghong Pulin. However, Longxing Chemical is 1.78 times more volatile than Zhonghong Pulin Medical. It trades about 0.04 of its potential returns per unit of risk. Zhonghong Pulin Medical is currently generating about 0.01 per unit of risk. If you would invest 634.00 in Longxing Chemical Stock on January 3, 2025 and sell it today you would earn a total of 11.00 from holding Longxing Chemical Stock or generate 1.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Longxing Chemical Stock vs. Zhonghong Pulin Medical
Performance |
| Timeline |
| Longxing Chemical Stock |
| Zhonghong Pulin Medical |
Longxing Chemical and Zhonghong Pulin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Longxing Chemical and Zhonghong Pulin
The main advantage of trading using opposite Longxing Chemical and Zhonghong Pulin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Longxing Chemical position performs unexpectedly, Zhonghong Pulin 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 Zhonghong Pulin will offset losses from the drop in Zhonghong Pulin's long position.| Longxing Chemical vs. Sinofibers Technology Co | Longxing Chemical vs. Eyebright Medical Technology | Longxing Chemical vs. AVIC Jonhon Optronic | Longxing Chemical vs. Anhui Jinhe Industrial |
| Zhonghong Pulin vs. Industrial and Commercial | Zhonghong Pulin vs. Kweichow Moutai Co | Zhonghong Pulin vs. Agricultural Bank of | Zhonghong Pulin vs. China Mobile Limited |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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