Correlation Between Lotus Health and ZTE Corp
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By analyzing existing cross correlation between Lotus Health Group and ZTE Corp, you can compare the effects of market volatilities on Lotus Health and ZTE Corp 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 Lotus Health with a short position of ZTE Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotus Health and ZTE Corp.
Diversification Opportunities for Lotus Health and ZTE Corp
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lotus and ZTE is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Lotus Health Group and ZTE Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZTE Corp and Lotus Health 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 Lotus Health Group are associated (or correlated) with ZTE Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZTE Corp has no effect on the direction of Lotus Health i.e., Lotus Health and ZTE Corp go up and down completely randomly.
Pair Corralation between Lotus Health and ZTE Corp
Assuming the 90 days trading horizon Lotus Health is expected to generate 3.41 times less return on investment than ZTE Corp. In addition to that, Lotus Health is 1.27 times more volatile than ZTE Corp. It trades about 0.01 of its total potential returns per unit of risk. ZTE Corp is currently generating about 0.04 per unit of volatility. If you would invest 2,594 in ZTE Corp on September 4, 2024 and sell it today you would earn a total of 566.00 from holding ZTE Corp or generate 21.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotus Health Group vs. ZTE Corp
Performance |
| Timeline |
| Lotus Health Group |
| ZTE Corp |
Lotus Health and ZTE Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotus Health and ZTE Corp
The main advantage of trading using opposite Lotus Health and ZTE Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotus Health position performs unexpectedly, ZTE Corp 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 ZTE Corp will offset losses from the drop in ZTE Corp's long position.| Lotus Health vs. Poly Real Estate | Lotus Health vs. China Vanke Co | Lotus Health vs. China Merchants Shekou | Lotus Health vs. Huafa Industrial Co |
| ZTE Corp vs. Industrial and Commercial | ZTE Corp vs. China Construction Bank | ZTE Corp vs. Bank of China | ZTE Corp vs. Agricultural Bank of |
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 CEOs Directory module to screen CEOs from public companies around the world.
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