Correlation Between Zhejiang Daily and Mengtian Home
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By analyzing existing cross correlation between Zhejiang Daily Media and Mengtian Home Group, you can compare the effects of market volatilities on Zhejiang Daily and Mengtian Home 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 Zhejiang Daily with a short position of Mengtian Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Daily and Mengtian Home.
Diversification Opportunities for Zhejiang Daily and Mengtian Home
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Zhejiang and Mengtian is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Daily Media and Mengtian Home Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mengtian Home Group and Zhejiang Daily 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 Zhejiang Daily Media are associated (or correlated) with Mengtian Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mengtian Home Group has no effect on the direction of Zhejiang Daily i.e., Zhejiang Daily and Mengtian Home go up and down completely randomly.
Pair Corralation between Zhejiang Daily and Mengtian Home
Assuming the 90 days trading horizon Zhejiang Daily Media is expected to generate 1.34 times more return on investment than Mengtian Home. However, Zhejiang Daily is 1.34 times more volatile than Mengtian Home Group. It trades about 0.07 of its potential returns per unit of risk. Mengtian Home Group is currently generating about 0.09 per unit of risk. If you would invest 934.00 in Zhejiang Daily Media on September 3, 2024 and sell it today you would earn a total of 180.00 from holding Zhejiang Daily Media or generate 19.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Daily Media vs. Mengtian Home Group
Performance |
| Timeline |
| Zhejiang Daily Media |
| Mengtian Home Group |
Zhejiang Daily and Mengtian Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Daily and Mengtian Home
The main advantage of trading using opposite Zhejiang Daily and Mengtian Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Daily position performs unexpectedly, Mengtian Home 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 Mengtian Home will offset losses from the drop in Mengtian Home's long position.| Zhejiang Daily vs. Metro Investment Development | Zhejiang Daily vs. Nuode Investment Co | Zhejiang Daily vs. Nexchip Semiconductor Corp | Zhejiang Daily vs. Hunan Investment Group |
| Mengtian Home vs. PetroChina Co Ltd | Mengtian Home vs. China Mobile Limited | Mengtian Home vs. Industrial and Commercial | Mengtian Home vs. China Life Insurance |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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