Correlation Between Zhejiang Juhua and Pengxin International
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By analyzing existing cross correlation between Zhejiang Juhua Co and Pengxin International Mining, you can compare the effects of market volatilities on Zhejiang Juhua and Pengxin International 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 Juhua with a short position of Pengxin International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Juhua and Pengxin International.
Diversification Opportunities for Zhejiang Juhua and Pengxin International
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Zhejiang and Pengxin is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Juhua Co and Pengxin International Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pengxin International and Zhejiang Juhua 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 Juhua Co are associated (or correlated) with Pengxin International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pengxin International has no effect on the direction of Zhejiang Juhua i.e., Zhejiang Juhua and Pengxin International go up and down completely randomly.
Pair Corralation between Zhejiang Juhua and Pengxin International
Assuming the 90 days trading horizon Zhejiang Juhua Co is expected to generate 0.86 times more return on investment than Pengxin International. However, Zhejiang Juhua Co is 1.16 times less risky than Pengxin International. It trades about 0.07 of its potential returns per unit of risk. Pengxin International Mining is currently generating about 0.01 per unit of risk. If you would invest 1,323 in Zhejiang Juhua Co on August 31, 2024 and sell it today you would earn a total of 886.00 from holding Zhejiang Juhua Co or generate 66.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.72% |
| Values | Daily Returns |
Zhejiang Juhua Co vs. Pengxin International Mining
Performance |
| Timeline |
| Zhejiang Juhua |
| Pengxin International |
Zhejiang Juhua and Pengxin International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Juhua and Pengxin International
The main advantage of trading using opposite Zhejiang Juhua and Pengxin International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Juhua position performs unexpectedly, Pengxin International 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 Pengxin International will offset losses from the drop in Pengxin International's long position.| Zhejiang Juhua vs. Zhejiang JIULI Hi tech | Zhejiang Juhua vs. Sunwave Communications Co | Zhejiang Juhua vs. Jinling Hotel Corp | Zhejiang Juhua vs. Guangzhou Haige Communications |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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