Correlation Between Long Yuan and Zhejiang Yongjin
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By analyzing existing cross correlation between Long Yuan Construction and Zhejiang Yongjin Metal, you can compare the effects of market volatilities on Long Yuan and Zhejiang Yongjin 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 Long Yuan with a short position of Zhejiang Yongjin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Long Yuan and Zhejiang Yongjin.
Diversification Opportunities for Long Yuan and Zhejiang Yongjin
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Long and Zhejiang is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Long Yuan Construction and Zhejiang Yongjin Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Yongjin Metal and Long Yuan 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 Long Yuan Construction are associated (or correlated) with Zhejiang Yongjin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Yongjin Metal has no effect on the direction of Long Yuan i.e., Long Yuan and Zhejiang Yongjin go up and down completely randomly.
Pair Corralation between Long Yuan and Zhejiang Yongjin
Assuming the 90 days trading horizon Long Yuan Construction is expected to generate 1.9 times more return on investment than Zhejiang Yongjin. However, Long Yuan is 1.9 times more volatile than Zhejiang Yongjin Metal. It trades about -0.1 of its potential returns per unit of risk. Zhejiang Yongjin Metal is currently generating about -0.19 per unit of risk. If you would invest 423.00 in Long Yuan Construction on August 28, 2024 and sell it today you would lose (36.00) from holding Long Yuan Construction or give up 8.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Long Yuan Construction vs. Zhejiang Yongjin Metal
Performance |
| Timeline |
| Long Yuan Construction |
| Zhejiang Yongjin Metal |
Long Yuan and Zhejiang Yongjin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Long Yuan and Zhejiang Yongjin
The main advantage of trading using opposite Long Yuan and Zhejiang Yongjin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Long Yuan position performs unexpectedly, Zhejiang Yongjin 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 Zhejiang Yongjin will offset losses from the drop in Zhejiang Yongjin's long position.| Long Yuan vs. Ming Yang Smart | Long Yuan vs. 159681 | Long Yuan vs. 159005 | Long Yuan vs. Loctek Ergonomic Technology |
| Zhejiang Yongjin vs. Wanhua Chemical Group | Zhejiang Yongjin vs. Shandong Gold Mining | Zhejiang Yongjin vs. Rongsheng Petrochemical Co | Zhejiang Yongjin vs. Inner Mongolia BaoTou |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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