Correlation Between Zhejiang Zhengguang and Shuhua Sports
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By analyzing existing cross correlation between Zhejiang Zhengguang Industrial and Shuhua Sports Co, you can compare the effects of market volatilities on Zhejiang Zhengguang and Shuhua Sports 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 Zhejiang Zhengguang with a short position of Shuhua Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Zhengguang and Shuhua Sports.
Diversification Opportunities for Zhejiang Zhengguang and Shuhua Sports
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Zhejiang and Shuhua is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Zhengguang Industrial and Shuhua Sports Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shuhua Sports and Zhejiang Zhengguang 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 Zhejiang Zhengguang Industrial are associated (or correlated) with Shuhua Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shuhua Sports has no effect on the direction of Zhejiang Zhengguang i.e., Zhejiang Zhengguang and Shuhua Sports go up and down completely randomly.
Pair Corralation between Zhejiang Zhengguang and Shuhua Sports
Assuming the 90 days trading horizon Zhejiang Zhengguang Industrial is expected to generate 0.48 times more return on investment than Shuhua Sports. However, Zhejiang Zhengguang Industrial is 2.1 times less risky than Shuhua Sports. It trades about 0.06 of its potential returns per unit of risk. Shuhua Sports Co is currently generating about -0.09 per unit of risk. If you would invest 2,282 in Zhejiang Zhengguang Industrial on November 3, 2024 and sell it today you would earn a total of 35.00 from holding Zhejiang Zhengguang Industrial or generate 1.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Zhengguang Industrial vs. Shuhua Sports Co
Performance |
| Timeline |
| Zhejiang Zhengguang |
| Shuhua Sports |
Zhejiang Zhengguang and Shuhua Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Zhengguang and Shuhua Sports
The main advantage of trading using opposite Zhejiang Zhengguang and Shuhua Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Zhengguang position performs unexpectedly, Shuhua Sports 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 Shuhua Sports will offset losses from the drop in Shuhua Sports' long position.| Zhejiang Zhengguang vs. Xilong Chemical Co | Zhejiang Zhengguang vs. Jinsanjiang Silicon Material | Zhejiang Zhengguang vs. Shandong Polymer Biochemicals | Zhejiang Zhengguang vs. Nantong JiangTian Chemical |
| Shuhua Sports vs. Shenzhen Bioeasy Biotechnology | Shuhua Sports vs. Shanghai Rightongene Biotechnology | Shuhua Sports vs. Guangdong Marubi Biotechnology | Shuhua Sports vs. Anhui Huaheng Biotechnology |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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