Correlation Between Double Medical and Zhejiang Kingland
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By analyzing existing cross correlation between Double Medical Technology and Zhejiang Kingland Pipeline, you can compare the effects of market volatilities on Double Medical and Zhejiang Kingland 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 Double Medical with a short position of Zhejiang Kingland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Double Medical and Zhejiang Kingland.
Diversification Opportunities for Double Medical and Zhejiang Kingland
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Double and Zhejiang is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Double Medical Technology and Zhejiang Kingland Pipeline in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Kingland and Double Medical 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 Double Medical Technology are associated (or correlated) with Zhejiang Kingland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Kingland has no effect on the direction of Double Medical i.e., Double Medical and Zhejiang Kingland go up and down completely randomly.
Pair Corralation between Double Medical and Zhejiang Kingland
Assuming the 90 days trading horizon Double Medical Technology is expected to generate 1.23 times more return on investment than Zhejiang Kingland. However, Double Medical is 1.23 times more volatile than Zhejiang Kingland Pipeline. It trades about 0.04 of its potential returns per unit of risk. Zhejiang Kingland Pipeline is currently generating about 0.02 per unit of risk. If you would invest 2,936 in Double Medical Technology on November 8, 2024 and sell it today you would earn a total of 576.00 from holding Double Medical Technology or generate 19.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Double Medical Technology vs. Zhejiang Kingland Pipeline
Performance |
| Timeline |
| Double Medical Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
| Zhejiang Kingland |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Double Medical and Zhejiang Kingland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Double Medical and Zhejiang Kingland
The main advantage of trading using opposite Double Medical and Zhejiang Kingland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Double Medical position performs unexpectedly, Zhejiang Kingland 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 Kingland will offset losses from the drop in Zhejiang Kingland's long position.The idea behind Double Medical Technology and Zhejiang Kingland Pipeline 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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