Correlation Between Pengxin International and Henzhen Zhaowei
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By analyzing existing cross correlation between Pengxin International Mining and Henzhen Zhaowei Machinery, you can compare the effects of market volatilities on Pengxin International and Henzhen Zhaowei 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 Henzhen Zhaowei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pengxin International and Henzhen Zhaowei.
Diversification Opportunities for Pengxin International and Henzhen Zhaowei
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pengxin and Henzhen is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Pengxin International Mining and Henzhen Zhaowei Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henzhen Zhaowei Machinery 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 Henzhen Zhaowei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henzhen Zhaowei Machinery has no effect on the direction of Pengxin International i.e., Pengxin International and Henzhen Zhaowei go up and down completely randomly.
Pair Corralation between Pengxin International and Henzhen Zhaowei
Assuming the 90 days trading horizon Pengxin International Mining is expected to under-perform the Henzhen Zhaowei. But the stock apears to be less risky and, when comparing its historical volatility, Pengxin International Mining is 1.94 times less risky than Henzhen Zhaowei. The stock trades about -0.04 of its potential returns per unit of risk. The Henzhen Zhaowei Machinery is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 4,802 in Henzhen Zhaowei Machinery on September 3, 2024 and sell it today you would earn a total of 2,608 from holding Henzhen Zhaowei Machinery or generate 54.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pengxin International Mining vs. Henzhen Zhaowei Machinery
Performance |
| Timeline |
| Pengxin International |
| Henzhen Zhaowei Machinery |
Pengxin International and Henzhen Zhaowei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pengxin International and Henzhen Zhaowei
The main advantage of trading using opposite Pengxin International and Henzhen Zhaowei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pengxin International position performs unexpectedly, Henzhen Zhaowei 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 Henzhen Zhaowei will offset losses from the drop in Henzhen Zhaowei's long position.| Pengxin International vs. Zijin Mining Group | Pengxin International vs. Baoshan Iron Steel | Pengxin International vs. Hoshine Silicon Ind |
| Henzhen Zhaowei vs. Cultural Investment Holdings | Henzhen Zhaowei vs. Gome Telecom Equipment | Henzhen Zhaowei vs. Bus Online Co | Henzhen Zhaowei vs. Holitech Technology Co |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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