Correlation Between ZongTai Real and Ying Han
Can any of the company-specific risk be diversified away by investing in both ZongTai Real and Ying Han at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining ZongTai Real and Ying Han into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZongTai Real Estate and Ying Han Technology, you can compare the effects of market volatilities on ZongTai Real and Ying Han 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 ZongTai Real with a short position of Ying Han. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZongTai Real and Ying Han.
Diversification Opportunities for ZongTai Real and Ying Han
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ZongTai and Ying is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding ZongTai Real Estate and Ying Han Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ying Han Technology and ZongTai Real 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 ZongTai Real Estate are associated (or correlated) with Ying Han. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ying Han Technology has no effect on the direction of ZongTai Real i.e., ZongTai Real and Ying Han go up and down completely randomly.
Pair Corralation between ZongTai Real and Ying Han
Assuming the 90 days trading horizon ZongTai Real Estate is expected to generate 0.38 times more return on investment than Ying Han. However, ZongTai Real Estate is 2.62 times less risky than Ying Han. It trades about 0.18 of its potential returns per unit of risk. Ying Han Technology is currently generating about 0.04 per unit of risk. If you would invest 3,230 in ZongTai Real Estate on September 2, 2024 and sell it today you would earn a total of 205.00 from holding ZongTai Real Estate or generate 6.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ZongTai Real Estate vs. Ying Han Technology
Performance |
| Timeline |
| ZongTai Real Estate |
| Ying Han Technology |
ZongTai Real and Ying Han Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZongTai Real and Ying Han
The main advantage of trading using opposite ZongTai Real and Ying Han positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZongTai Real position performs unexpectedly, Ying Han 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 Ying Han will offset losses from the drop in Ying Han's long position.| ZongTai Real vs. Hunya Foods Co | ZongTai Real vs. Standard Foods Corp | ZongTai Real vs. First Insurance Co | ZongTai Real vs. Kao Fong Machinery |
| Ying Han vs. Sunonwealth Electric Machine | Ying Han vs. Rechi Precision Co | Ying Han vs. Fittech Co | Ying Han vs. C Sun Manufacturing |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |