Correlation Between Zhonghong Pulin and Shenzhen Fortune
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By analyzing existing cross correlation between Zhonghong Pulin Medical and Shenzhen Fortune Trend, you can compare the effects of market volatilities on Zhonghong Pulin and Shenzhen Fortune 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 Zhonghong Pulin with a short position of Shenzhen Fortune. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhonghong Pulin and Shenzhen Fortune.
Diversification Opportunities for Zhonghong Pulin and Shenzhen Fortune
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhonghong and Shenzhen is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Zhonghong Pulin Medical and Shenzhen Fortune Trend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Fortune Trend and Zhonghong Pulin 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 Zhonghong Pulin Medical are associated (or correlated) with Shenzhen Fortune. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Fortune Trend has no effect on the direction of Zhonghong Pulin i.e., Zhonghong Pulin and Shenzhen Fortune go up and down completely randomly.
Pair Corralation between Zhonghong Pulin and Shenzhen Fortune
Assuming the 90 days trading horizon Zhonghong Pulin Medical is expected to generate 0.64 times more return on investment than Shenzhen Fortune. However, Zhonghong Pulin Medical is 1.57 times less risky than Shenzhen Fortune. It trades about -0.45 of its potential returns per unit of risk. Shenzhen Fortune Trend is currently generating about -0.31 per unit of risk. If you would invest 1,455 in Zhonghong Pulin Medical on October 14, 2024 and sell it today you would lose (254.00) from holding Zhonghong Pulin Medical or give up 17.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhonghong Pulin Medical vs. Shenzhen Fortune Trend
Performance |
| Timeline |
| Zhonghong Pulin Medical |
| Shenzhen Fortune Trend |
Zhonghong Pulin and Shenzhen Fortune Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhonghong Pulin and Shenzhen Fortune
The main advantage of trading using opposite Zhonghong Pulin and Shenzhen Fortune positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhonghong Pulin position performs unexpectedly, Shenzhen Fortune 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 Shenzhen Fortune will offset losses from the drop in Shenzhen Fortune's long position.| Zhonghong Pulin vs. Liaoning Dingjide Petrochemical | Zhonghong Pulin vs. China Mobile Limited | Zhonghong Pulin vs. Xinxiang Chemical Fiber | Zhonghong Pulin vs. Longxing Chemical Stock |
| Shenzhen Fortune vs. Zhonghong Pulin Medical | Shenzhen Fortune vs. Winner Medical Co | Shenzhen Fortune vs. Industrial Bank Co | Shenzhen Fortune vs. Nanjing Vishee Medical |
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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