Correlation Between Baoshan Iron and Zhejiang Zanyu
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By analyzing existing cross correlation between Baoshan Iron Steel and Zhejiang Zanyu Technology, you can compare the effects of market volatilities on Baoshan Iron and Zhejiang Zanyu 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 Baoshan Iron with a short position of Zhejiang Zanyu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baoshan Iron and Zhejiang Zanyu.
Diversification Opportunities for Baoshan Iron and Zhejiang Zanyu
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Baoshan and Zhejiang is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Baoshan Iron Steel and Zhejiang Zanyu Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Zanyu Technology and Baoshan Iron 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 Baoshan Iron Steel are associated (or correlated) with Zhejiang Zanyu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Zanyu Technology has no effect on the direction of Baoshan Iron i.e., Baoshan Iron and Zhejiang Zanyu go up and down completely randomly.
Pair Corralation between Baoshan Iron and Zhejiang Zanyu
Assuming the 90 days trading horizon Baoshan Iron is expected to generate 12.53 times less return on investment than Zhejiang Zanyu. But when comparing it to its historical volatility, Baoshan Iron Steel is 2.41 times less risky than Zhejiang Zanyu. It trades about 0.05 of its potential returns per unit of risk. Zhejiang Zanyu Technology is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 895.00 in Zhejiang Zanyu Technology on September 1, 2024 and sell it today you would earn a total of 215.00 from holding Zhejiang Zanyu Technology or generate 24.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Baoshan Iron Steel vs. Zhejiang Zanyu Technology
Performance |
| Timeline |
| Baoshan Iron Steel |
| Zhejiang Zanyu Technology |
Baoshan Iron and Zhejiang Zanyu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baoshan Iron and Zhejiang Zanyu
The main advantage of trading using opposite Baoshan Iron and Zhejiang Zanyu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baoshan Iron position performs unexpectedly, Zhejiang Zanyu 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 Zhejiang Zanyu will offset losses from the drop in Zhejiang Zanyu's long position.| Baoshan Iron vs. Hubei Xingfa Chemicals | Baoshan Iron vs. Shanghai Jinfeng Wine | Baoshan Iron vs. Dazhong Transportation Group | Baoshan Iron vs. Sichuan Fulin Transportation |
| Zhejiang Zanyu vs. Zijin Mining Group | Zhejiang Zanyu vs. Wanhua Chemical Group | Zhejiang Zanyu vs. Baoshan Iron Steel | Zhejiang Zanyu vs. Shandong Gold Mining |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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