Correlation Between Zhongzhu Medical and China Life
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By analyzing existing cross correlation between Zhongzhu Medical Holdings and China Life Insurance, you can compare the effects of market volatilities on Zhongzhu Medical and China Life 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 China Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongzhu Medical and China Life.
Diversification Opportunities for Zhongzhu Medical and China Life
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhongzhu and China is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Zhongzhu Medical Holdings and China Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Life Insurance 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 China Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Life Insurance has no effect on the direction of Zhongzhu Medical i.e., Zhongzhu Medical and China Life go up and down completely randomly.
Pair Corralation between Zhongzhu Medical and China Life
Assuming the 90 days trading horizon Zhongzhu Medical Holdings is expected to under-perform the China Life. But the stock apears to be less risky and, when comparing its historical volatility, Zhongzhu Medical Holdings is 1.04 times less risky than China Life. The stock trades about -0.03 of its potential returns per unit of risk. The China Life Insurance is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 3,410 in China Life Insurance on November 2, 2024 and sell it today you would earn a total of 650.00 from holding China Life Insurance or generate 19.06% 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. China Life Insurance
Performance |
| Timeline |
| Zhongzhu Medical Holdings |
| China Life Insurance |
Zhongzhu Medical and China Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongzhu Medical and China Life
The main advantage of trading using opposite Zhongzhu Medical and China Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongzhu Medical position performs unexpectedly, China Life 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 China Life will offset losses from the drop in China Life'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 |
| China Life vs. Allmed Medical Products | China Life vs. Financial Street Holdings | China Life vs. Zhonghong Pulin Medical | China Life vs. Peoples Insurance of |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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