Correlation Between Zhonghang Electronic and East Money
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By analyzing existing cross correlation between Zhonghang Electronic Measuring and East Money Information, you can compare the effects of market volatilities on Zhonghang Electronic and East Money 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 Zhonghang Electronic with a short position of East Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhonghang Electronic and East Money.
Diversification Opportunities for Zhonghang Electronic and East Money
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Zhonghang and East is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Zhonghang Electronic Measuring and East Money Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East Money Information and Zhonghang Electronic 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 Zhonghang Electronic Measuring are associated (or correlated) with East Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East Money Information has no effect on the direction of Zhonghang Electronic i.e., Zhonghang Electronic and East Money go up and down completely randomly.
Pair Corralation between Zhonghang Electronic and East Money
Assuming the 90 days trading horizon Zhonghang Electronic Measuring is expected to generate 1.19 times more return on investment than East Money. However, Zhonghang Electronic is 1.19 times more volatile than East Money Information. It trades about -0.06 of its potential returns per unit of risk. East Money Information is currently generating about -0.13 per unit of risk. If you would invest 7,296 in Zhonghang Electronic Measuring on October 26, 2024 and sell it today you would lose (443.00) from holding Zhonghang Electronic Measuring or give up 6.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Zhonghang Electronic Measuring vs. East Money Information
Performance |
| Timeline |
| Zhonghang Electronic |
| East Money Information |
Zhonghang Electronic and East Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhonghang Electronic and East Money
The main advantage of trading using opposite Zhonghang Electronic and East Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhonghang Electronic position performs unexpectedly, East Money 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 East Money will offset losses from the drop in East Money's long position.The idea behind Zhonghang Electronic Measuring and East Money Information 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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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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