Correlation Between Marssenger Kitchenware and Henzhen Zhaowei
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By analyzing existing cross correlation between Marssenger Kitchenware Co and Henzhen Zhaowei Machinery, you can compare the effects of market volatilities on Marssenger Kitchenware and Henzhen Zhaowei 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 Marssenger Kitchenware with a short position of Henzhen Zhaowei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marssenger Kitchenware and Henzhen Zhaowei.
Diversification Opportunities for Marssenger Kitchenware and Henzhen Zhaowei
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Marssenger and Henzhen is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Marssenger Kitchenware Co and Henzhen Zhaowei Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henzhen Zhaowei Machinery and Marssenger Kitchenware 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 Marssenger Kitchenware Co are associated (or correlated) with Henzhen Zhaowei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henzhen Zhaowei Machinery has no effect on the direction of Marssenger Kitchenware i.e., Marssenger Kitchenware and Henzhen Zhaowei go up and down completely randomly.
Pair Corralation between Marssenger Kitchenware and Henzhen Zhaowei
Assuming the 90 days trading horizon Marssenger Kitchenware Co is expected to under-perform the Henzhen Zhaowei. But the stock apears to be less risky and, when comparing its historical volatility, Marssenger Kitchenware Co is 1.31 times less risky than Henzhen Zhaowei. The stock trades about -0.08 of its potential returns per unit of risk. The Henzhen Zhaowei Machinery is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 4,492 in Henzhen Zhaowei Machinery on August 29, 2024 and sell it today you would earn a total of 2,243 from holding Henzhen Zhaowei Machinery or generate 49.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marssenger Kitchenware Co vs. Henzhen Zhaowei Machinery
Performance |
| Timeline |
| Marssenger Kitchenware |
| Henzhen Zhaowei Machinery |
Marssenger Kitchenware and Henzhen Zhaowei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marssenger Kitchenware and Henzhen Zhaowei
The main advantage of trading using opposite Marssenger Kitchenware and Henzhen Zhaowei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marssenger Kitchenware position performs unexpectedly, Henzhen Zhaowei 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 Henzhen Zhaowei will offset losses from the drop in Henzhen Zhaowei's long position.| Marssenger Kitchenware vs. Agricultural Bank of | Marssenger Kitchenware vs. Industrial and Commercial | Marssenger Kitchenware vs. Bank of China | Marssenger Kitchenware vs. China Construction Bank |
| Henzhen Zhaowei vs. PetroChina Co Ltd | Henzhen Zhaowei vs. China State Construction | Henzhen Zhaowei vs. China Mobile Limited | Henzhen Zhaowei vs. Industrial and Commercial |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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