Correlation Between ZhongAn Online and Coor Service

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Can any of the company-specific risk be diversified away by investing in both ZhongAn Online and Coor Service 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 ZhongAn Online and Coor Service into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZhongAn Online P and Coor Service Management, you can compare the effects of market volatilities on ZhongAn Online and Coor Service 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 ZhongAn Online with a short position of Coor Service. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZhongAn Online and Coor Service.

Diversification Opportunities for ZhongAn Online and Coor Service

ZhongAnCoorDiversified AwayZhongAnCoorDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between ZhongAn and Coor is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ZhongAn Online P and Coor Service Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coor Service Management and ZhongAn Online 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 ZhongAn Online P are associated (or correlated) with Coor Service. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coor Service Management has no effect on the direction of ZhongAn Online i.e., ZhongAn Online and Coor Service go up and down completely randomly.

Pair Corralation between ZhongAn Online and Coor Service

Assuming the 90 days trading horizon ZhongAn Online P is expected to generate 1.62 times more return on investment than Coor Service. However, ZhongAn Online is 1.62 times more volatile than Coor Service Management. It trades about 0.26 of its potential returns per unit of risk. Coor Service Management is currently generating about 0.19 per unit of risk. If you would invest  139.00  in ZhongAn Online P on November 25, 2024 and sell it today you would earn a total of  39.00  from holding ZhongAn Online P or generate 28.06% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

ZhongAn Online P  vs.  Coor Service Management

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -15-10-50510
JavaScript chart by amCharts 3.21.151ZO COE
       Timeline  
ZhongAn Online P 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in ZhongAn Online P are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, ZhongAn Online unveiled solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb1.31.41.51.61.71.8
Coor Service Management 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Coor Service Management are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Coor Service is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb2.62.72.82.933.13.2

ZhongAn Online and Coor Service Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-11.22-8.4-5.59-2.770.022.865.788.6911.6 0.010.020.030.040.05
JavaScript chart by amCharts 3.21.151ZO COE
       Returns  

Pair Trading with ZhongAn Online and Coor Service

The main advantage of trading using opposite ZhongAn Online and Coor Service positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZhongAn Online position performs unexpectedly, Coor Service 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 Coor Service will offset losses from the drop in Coor Service's long position.
The idea behind ZhongAn Online P and Coor Service Management 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.
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.

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