Correlation Between Dr Peng and Linzhou Heavy
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By analyzing existing cross correlation between Dr Peng Telecom and Linzhou Heavy Machinery, you can compare the effects of market volatilities on Dr Peng and Linzhou Heavy 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 Dr Peng with a short position of Linzhou Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dr Peng and Linzhou Heavy.
Diversification Opportunities for Dr Peng and Linzhou Heavy
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 600804 and Linzhou is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Dr Peng Telecom and Linzhou Heavy Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Linzhou Heavy Machinery and Dr Peng 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 Dr Peng Telecom are associated (or correlated) with Linzhou Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Linzhou Heavy Machinery has no effect on the direction of Dr Peng i.e., Dr Peng and Linzhou Heavy go up and down completely randomly.
Pair Corralation between Dr Peng and Linzhou Heavy
Assuming the 90 days trading horizon Dr Peng Telecom is expected to under-perform the Linzhou Heavy. In addition to that, Dr Peng is 1.02 times more volatile than Linzhou Heavy Machinery. It trades about -0.03 of its total potential returns per unit of risk. Linzhou Heavy Machinery is currently generating about 0.04 per unit of volatility. If you would invest 292.00 in Linzhou Heavy Machinery on December 4, 2024 and sell it today you would earn a total of 120.00 from holding Linzhou Heavy Machinery or generate 41.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.58% |
| Values | Daily Returns |
Dr Peng Telecom vs. Linzhou Heavy Machinery
Performance |
| Timeline |
| Dr Peng Telecom |
| Linzhou Heavy Machinery |
Dr Peng and Linzhou Heavy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dr Peng and Linzhou Heavy
The main advantage of trading using opposite Dr Peng and Linzhou Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dr Peng position performs unexpectedly, Linzhou Heavy 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 Linzhou Heavy will offset losses from the drop in Linzhou Heavy's long position.| Dr Peng vs. Qingdao Foods Co | Dr Peng vs. Hainan Haiqi Transportation | Dr Peng vs. Sportsoul Co Ltd | Dr Peng vs. Jiangsu Jinling Sports |
| Linzhou Heavy vs. Iat Automobile Technology | Linzhou Heavy vs. SSAW Hotels Resorts | Linzhou Heavy vs. Great Sun Foods Co | Linzhou Heavy vs. Xiangpiaopiao Food 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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