Correlation Between Liuzhou Chemical and Zoje Resources
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By analyzing existing cross correlation between Liuzhou Chemical Industry and Zoje Resources Investment, you can compare the effects of market volatilities on Liuzhou Chemical and Zoje Resources 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 Liuzhou Chemical with a short position of Zoje Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liuzhou Chemical and Zoje Resources.
Diversification Opportunities for Liuzhou Chemical and Zoje Resources
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Liuzhou and Zoje is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Liuzhou Chemical Industry and Zoje Resources Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zoje Resources Investment and Liuzhou Chemical 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 Liuzhou Chemical Industry are associated (or correlated) with Zoje Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zoje Resources Investment has no effect on the direction of Liuzhou Chemical i.e., Liuzhou Chemical and Zoje Resources go up and down completely randomly.
Pair Corralation between Liuzhou Chemical and Zoje Resources
Assuming the 90 days trading horizon Liuzhou Chemical is expected to generate 2.8 times less return on investment than Zoje Resources. But when comparing it to its historical volatility, Liuzhou Chemical Industry is 1.58 times less risky than Zoje Resources. It trades about 0.07 of its potential returns per unit of risk. Zoje Resources Investment is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 187.00 in Zoje Resources Investment on October 14, 2024 and sell it today you would earn a total of 58.00 from holding Zoje Resources Investment or generate 31.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liuzhou Chemical Industry vs. Zoje Resources Investment
Performance |
| Timeline |
| Liuzhou Chemical Industry |
| Zoje Resources Investment |
Liuzhou Chemical and Zoje Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liuzhou Chemical and Zoje Resources
The main advantage of trading using opposite Liuzhou Chemical and Zoje Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liuzhou Chemical position performs unexpectedly, Zoje Resources 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 Zoje Resources will offset losses from the drop in Zoje Resources' long position.| Liuzhou Chemical vs. Hefei Metalforming Mach | Liuzhou Chemical vs. Fujian Nanwang Environment | Liuzhou Chemical vs. Hangzhou Guotai Environmental | Liuzhou Chemical vs. Gansu Jiu Steel |
| Zoje Resources vs. Humanwell Healthcare Group | Zoje Resources vs. Mingchen Health Co | Zoje Resources vs. Liuzhou Chemical Industry | Zoje Resources vs. Shandong Sinoglory Health |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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