Correlation Between Hangzhou Gaoxin and Zhejiang Kingland
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By analyzing existing cross correlation between Hangzhou Gaoxin Rubber and Zhejiang Kingland Pipeline, you can compare the effects of market volatilities on Hangzhou Gaoxin 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 Hangzhou Gaoxin with a short position of Zhejiang Kingland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hangzhou Gaoxin and Zhejiang Kingland.
Diversification Opportunities for Hangzhou Gaoxin and Zhejiang Kingland
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hangzhou and Zhejiang is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Hangzhou Gaoxin Rubber and Zhejiang Kingland Pipeline in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Kingland and Hangzhou Gaoxin 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 Hangzhou Gaoxin Rubber 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 Hangzhou Gaoxin i.e., Hangzhou Gaoxin and Zhejiang Kingland go up and down completely randomly.
Pair Corralation between Hangzhou Gaoxin and Zhejiang Kingland
Assuming the 90 days trading horizon Hangzhou Gaoxin Rubber is expected to generate 1.53 times more return on investment than Zhejiang Kingland. However, Hangzhou Gaoxin is 1.53 times more volatile than Zhejiang Kingland Pipeline. It trades about 0.2 of its potential returns per unit of risk. Zhejiang Kingland Pipeline is currently generating about 0.15 per unit of risk. If you would invest 709.00 in Hangzhou Gaoxin Rubber on September 3, 2024 and sell it today you would earn a total of 373.00 from holding Hangzhou Gaoxin Rubber or generate 52.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hangzhou Gaoxin Rubber vs. Zhejiang Kingland Pipeline
Performance |
| Timeline |
| Hangzhou Gaoxin Rubber |
| Zhejiang Kingland |
Hangzhou Gaoxin and Zhejiang Kingland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hangzhou Gaoxin and Zhejiang Kingland
The main advantage of trading using opposite Hangzhou Gaoxin and Zhejiang Kingland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hangzhou Gaoxin 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.| Hangzhou Gaoxin vs. Zijin Mining Group | Hangzhou Gaoxin vs. Baoshan Iron Steel | Hangzhou Gaoxin vs. Rongsheng Petrochemical Co | Hangzhou Gaoxin vs. Hoshine Silicon Ind |
| Zhejiang Kingland vs. Gansu Jiu Steel | Zhejiang Kingland vs. Ming Yang Smart | Zhejiang Kingland vs. Aba Chemicals Corp | Zhejiang Kingland vs. Loctek Ergonomic Technology |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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