Correlation Between Pengxin International and Zotye Automobile
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By analyzing existing cross correlation between Pengxin International Mining and Zotye Automobile Co, you can compare the effects of market volatilities on Pengxin International and Zotye Automobile 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 Pengxin International with a short position of Zotye Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pengxin International and Zotye Automobile.
Diversification Opportunities for Pengxin International and Zotye Automobile
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Pengxin and Zotye is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Pengxin International Mining and Zotye Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zotye Automobile and Pengxin International 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 Pengxin International Mining are associated (or correlated) with Zotye Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zotye Automobile has no effect on the direction of Pengxin International i.e., Pengxin International and Zotye Automobile go up and down completely randomly.
Pair Corralation between Pengxin International and Zotye Automobile
Assuming the 90 days trading horizon Pengxin International Mining is expected to generate 0.74 times more return on investment than Zotye Automobile. However, Pengxin International Mining is 1.35 times less risky than Zotye Automobile. It trades about 0.01 of its potential returns per unit of risk. Zotye Automobile Co is currently generating about -0.02 per unit of risk. If you would invest 318.00 in Pengxin International Mining on September 3, 2024 and sell it today you would lose (2.00) from holding Pengxin International Mining or give up 0.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pengxin International Mining vs. Zotye Automobile Co
Performance |
| Timeline |
| Pengxin International |
| Zotye Automobile |
Pengxin International and Zotye Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pengxin International and Zotye Automobile
The main advantage of trading using opposite Pengxin International and Zotye Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pengxin International position performs unexpectedly, Zotye Automobile 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 Zotye Automobile will offset losses from the drop in Zotye Automobile's long position.| Pengxin International vs. Zijin Mining Group | Pengxin International vs. Baoshan Iron Steel | Pengxin International vs. Rongsheng Petrochemical Co | Pengxin International vs. Hoshine Silicon Ind |
| Zotye Automobile vs. Xinjiang Baodi Mining | Zotye Automobile vs. Quectel Wireless Solutions | Zotye Automobile vs. Shanghai Metersbonwe FashionAccessories | Zotye Automobile vs. Pengxin International 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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