Correlation Between Zhejiang Yayi and Chahua Modern
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By analyzing existing cross correlation between Zhejiang Yayi Metal and Chahua Modern Housewares, you can compare the effects of market volatilities on Zhejiang Yayi and Chahua Modern 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 Yayi with a short position of Chahua Modern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Yayi and Chahua Modern.
Diversification Opportunities for Zhejiang Yayi and Chahua Modern
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Zhejiang and Chahua is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Yayi Metal and Chahua Modern Housewares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chahua Modern Housewares and Zhejiang Yayi 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 Yayi Metal are associated (or correlated) with Chahua Modern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chahua Modern Housewares has no effect on the direction of Zhejiang Yayi i.e., Zhejiang Yayi and Chahua Modern go up and down completely randomly.
Pair Corralation between Zhejiang Yayi and Chahua Modern
Assuming the 90 days trading horizon Zhejiang Yayi is expected to generate 1.32 times less return on investment than Chahua Modern. But when comparing it to its historical volatility, Zhejiang Yayi Metal is 1.81 times less risky than Chahua Modern. It trades about 0.22 of its potential returns per unit of risk. Chahua Modern Housewares is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,889 in Chahua Modern Housewares on September 4, 2024 and sell it today you would earn a total of 271.00 from holding Chahua Modern Housewares or generate 14.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Yayi Metal vs. Chahua Modern Housewares
Performance |
| Timeline |
| Zhejiang Yayi Metal |
| Chahua Modern Housewares |
Zhejiang Yayi and Chahua Modern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Yayi and Chahua Modern
The main advantage of trading using opposite Zhejiang Yayi and Chahua Modern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Yayi position performs unexpectedly, Chahua Modern 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 Chahua Modern will offset losses from the drop in Chahua Modern's long position.| Zhejiang Yayi vs. Industrial and Commercial | Zhejiang Yayi vs. Agricultural Bank of | Zhejiang Yayi vs. China Construction Bank | Zhejiang Yayi vs. Bank of China |
| Chahua Modern vs. Zhejiang Yayi Metal | Chahua Modern vs. Bomin Electronics Co | Chahua Modern vs. Nantong Haixing Electronics | Chahua Modern vs. Leyard Optoelectronic |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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