Correlation Between 159681 and Zhejiang Kingland

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Can any of the company-specific risk be diversified away by investing in both 159681 and Zhejiang Kingland at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining 159681 and Zhejiang Kingland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 159681 and Zhejiang Kingland Pipeline, you can compare the effects of market volatilities on 159681 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 159681 with a short position of Zhejiang Kingland. Check out your portfolio center. Please also check ongoing floating volatility patterns of 159681 and Zhejiang Kingland.

Diversification Opportunities for 159681 and Zhejiang Kingland

159681ZhejiangDiversified Away159681ZhejiangDiversified Away100%
0.91
  Correlation Coefficient

Almost no diversification

The 3 months correlation between 159681 and Zhejiang is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding 159681 and Zhejiang Kingland Pipeline in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Kingland and 159681 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 159681 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 159681 i.e., 159681 and Zhejiang Kingland go up and down completely randomly.

Pair Corralation between 159681 and Zhejiang Kingland

Assuming the 90 days trading horizon 159681 is expected to generate 1.14 times more return on investment than Zhejiang Kingland. However, 159681 is 1.14 times more volatile than Zhejiang Kingland Pipeline. It trades about 0.01 of its potential returns per unit of risk. Zhejiang Kingland Pipeline is currently generating about 0.01 per unit of risk. If you would invest  100.00  in 159681 on September 19, 2024 and sell it today you would lose (3.00) from holding 159681 or give up 3.0% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

159681  vs.  Zhejiang Kingland Pipeline

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec 020406080
JavaScript chart by amCharts 3.21.15159681 002443
       Timeline  
159681 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in 159681 are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, 159681 sustained solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec0.70.80.911.11.2
Zhejiang Kingland 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Zhejiang Kingland Pipeline are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Zhejiang Kingland sustained solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec55.566.57

159681 and Zhejiang Kingland Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-15.31-11.46-7.62-3.780.06874.058.1812.316.42 0.010.020.030.040.050.06
JavaScript chart by amCharts 3.21.15159681 002443
       Returns  

Pair Trading with 159681 and Zhejiang Kingland

The main advantage of trading using opposite 159681 and Zhejiang Kingland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 159681 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 159681 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .

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