Correlation Between TITAN MACHINERY and ZhongAn Online
Can any of the company-specific risk be diversified away by investing in both TITAN MACHINERY and ZhongAn Online 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 TITAN MACHINERY and ZhongAn Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TITAN MACHINERY and ZhongAn Online P, you can compare the effects of market volatilities on TITAN MACHINERY and ZhongAn Online 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 TITAN MACHINERY with a short position of ZhongAn Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of TITAN MACHINERY and ZhongAn Online.
Diversification Opportunities for TITAN MACHINERY and ZhongAn Online
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between TITAN and ZhongAn is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding TITAN MACHINERY and ZhongAn Online P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZhongAn Online P and TITAN MACHINERY 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 TITAN MACHINERY are associated (or correlated) with ZhongAn Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZhongAn Online P has no effect on the direction of TITAN MACHINERY i.e., TITAN MACHINERY and ZhongAn Online go up and down completely randomly.
Pair Corralation between TITAN MACHINERY and ZhongAn Online
Assuming the 90 days trading horizon TITAN MACHINERY is expected to generate 0.81 times more return on investment than ZhongAn Online. However, TITAN MACHINERY is 1.24 times less risky than ZhongAn Online. It trades about 0.16 of its potential returns per unit of risk. ZhongAn Online P is currently generating about -0.1 per unit of risk. If you would invest 1,340 in TITAN MACHINERY on September 15, 2024 and sell it today you would earn a total of 100.00 from holding TITAN MACHINERY or generate 7.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TITAN MACHINERY vs. ZhongAn Online P
Performance |
| Timeline |
| TITAN MACHINERY |
| ZhongAn Online P |
TITAN MACHINERY and ZhongAn Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TITAN MACHINERY and ZhongAn Online
The main advantage of trading using opposite TITAN MACHINERY and ZhongAn Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TITAN MACHINERY position performs unexpectedly, ZhongAn Online 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 ZhongAn Online will offset losses from the drop in ZhongAn Online's long position.| TITAN MACHINERY vs. Taiwan Semiconductor Manufacturing | TITAN MACHINERY vs. VITEC SOFTWARE GROUP | TITAN MACHINERY vs. NTG Nordic Transport | TITAN MACHINERY vs. TOREX SEMICONDUCTOR LTD |
| ZhongAn Online vs. The Peoples Insurance | ZhongAn Online vs. W R Berkley | ZhongAn Online vs. The Hanover Insurance |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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