Correlation Between Zhongzhu Medical and Xinhu Zhongbao
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By analyzing existing cross correlation between Zhongzhu Medical Holdings and Xinhu Zhongbao Co, you can compare the effects of market volatilities on Zhongzhu Medical and Xinhu Zhongbao 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 Zhongzhu Medical with a short position of Xinhu Zhongbao. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongzhu Medical and Xinhu Zhongbao.
Diversification Opportunities for Zhongzhu Medical and Xinhu Zhongbao
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhongzhu and Xinhu is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Zhongzhu Medical Holdings and Xinhu Zhongbao Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinhu Zhongbao and Zhongzhu Medical 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 Zhongzhu Medical Holdings are associated (or correlated) with Xinhu Zhongbao. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinhu Zhongbao has no effect on the direction of Zhongzhu Medical i.e., Zhongzhu Medical and Xinhu Zhongbao go up and down completely randomly.
Pair Corralation between Zhongzhu Medical and Xinhu Zhongbao
Assuming the 90 days trading horizon Zhongzhu Medical Holdings is expected to under-perform the Xinhu Zhongbao. But the stock apears to be less risky and, when comparing its historical volatility, Zhongzhu Medical Holdings is 1.11 times less risky than Xinhu Zhongbao. The stock trades about -0.03 of its potential returns per unit of risk. The Xinhu Zhongbao Co is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 268.00 in Xinhu Zhongbao Co on November 2, 2024 and sell it today you would earn a total of 20.00 from holding Xinhu Zhongbao Co or generate 7.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongzhu Medical Holdings vs. Xinhu Zhongbao Co
Performance |
| Timeline |
| Zhongzhu Medical Holdings |
| Xinhu Zhongbao |
Zhongzhu Medical and Xinhu Zhongbao Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongzhu Medical and Xinhu Zhongbao
The main advantage of trading using opposite Zhongzhu Medical and Xinhu Zhongbao positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongzhu Medical position performs unexpectedly, Xinhu Zhongbao 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 Xinhu Zhongbao will offset losses from the drop in Xinhu Zhongbao's long position.| Zhongzhu Medical vs. CIMC Vehicles Co | Zhongzhu Medical vs. Haima Automobile Group | Zhongzhu Medical vs. Ping An Insurance | Zhongzhu Medical vs. Guangzhou Automobile Group |
| Xinhu Zhongbao vs. Wuhan Yangtze Communication | Xinhu Zhongbao vs. Beijing Yanjing Brewery | Xinhu Zhongbao vs. Shanghai Ziyan Foods | Xinhu Zhongbao vs. Guangxi Wuzhou Communications |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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