Correlation Between Penyao Environmental and Zhejiang Juhua
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By analyzing existing cross correlation between Penyao Environmental Protection and Zhejiang Juhua Co, you can compare the effects of market volatilities on Penyao Environmental and Zhejiang Juhua 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 Penyao Environmental with a short position of Zhejiang Juhua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penyao Environmental and Zhejiang Juhua.
Diversification Opportunities for Penyao Environmental and Zhejiang Juhua
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Penyao and Zhejiang is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Penyao Environmental Protectio and Zhejiang Juhua Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Juhua and Penyao Environmental 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 Penyao Environmental Protection are associated (or correlated) with Zhejiang Juhua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Juhua has no effect on the direction of Penyao Environmental i.e., Penyao Environmental and Zhejiang Juhua go up and down completely randomly.
Pair Corralation between Penyao Environmental and Zhejiang Juhua
Assuming the 90 days trading horizon Penyao Environmental is expected to generate 4.93 times less return on investment than Zhejiang Juhua. But when comparing it to its historical volatility, Penyao Environmental Protection is 1.12 times less risky than Zhejiang Juhua. It trades about 0.01 of its potential returns per unit of risk. Zhejiang Juhua Co is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,580 in Zhejiang Juhua Co on October 16, 2024 and sell it today you would earn a total of 880.00 from holding Zhejiang Juhua Co or generate 55.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Penyao Environmental Protectio vs. Zhejiang Juhua Co
Performance |
| Timeline |
| Penyao Environmental |
| Zhejiang Juhua |
Penyao Environmental and Zhejiang Juhua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Penyao Environmental and Zhejiang Juhua
The main advantage of trading using opposite Penyao Environmental and Zhejiang Juhua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penyao Environmental position performs unexpectedly, Zhejiang Juhua 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 Juhua will offset losses from the drop in Zhejiang Juhua's long position.| Penyao Environmental vs. Guocheng Mining Co | Penyao Environmental vs. Zhengzhou Coal Mining | Penyao Environmental vs. Uroica Mining Safety | Penyao Environmental vs. Shengda Mining Co |
| Zhejiang Juhua vs. Eastern Air Logistics | Zhejiang Juhua vs. HaiXin Foods Co | Zhejiang Juhua vs. Harbin Air Conditioning | Zhejiang Juhua vs. Jiahe Foods Industry |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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