Correlation Between China Aluminum and Zhejiang Construction
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By analyzing existing cross correlation between China Aluminum International and Zhejiang Construction Investment, you can compare the effects of market volatilities on China Aluminum and Zhejiang Construction 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 China Aluminum with a short position of Zhejiang Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Aluminum and Zhejiang Construction.
Diversification Opportunities for China Aluminum and Zhejiang Construction
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Zhejiang is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding China Aluminum International and Zhejiang Construction Investme in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Construction and China Aluminum 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 China Aluminum International are associated (or correlated) with Zhejiang Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Construction has no effect on the direction of China Aluminum i.e., China Aluminum and Zhejiang Construction go up and down completely randomly.
Pair Corralation between China Aluminum and Zhejiang Construction
Assuming the 90 days trading horizon China Aluminum International is expected to generate 0.84 times more return on investment than Zhejiang Construction. However, China Aluminum International is 1.18 times less risky than Zhejiang Construction. It trades about 0.0 of its potential returns per unit of risk. Zhejiang Construction Investment is currently generating about -0.01 per unit of risk. If you would invest 458.00 in China Aluminum International on October 16, 2024 and sell it today you would lose (46.00) from holding China Aluminum International or give up 10.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.61% |
| Values | Daily Returns |
China Aluminum International vs. Zhejiang Construction Investme
Performance |
| Timeline |
| China Aluminum Inter |
| Zhejiang Construction |
China Aluminum and Zhejiang Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Aluminum and Zhejiang Construction
The main advantage of trading using opposite China Aluminum and Zhejiang Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Aluminum position performs unexpectedly, Zhejiang Construction 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 Construction will offset losses from the drop in Zhejiang Construction's long position.| China Aluminum vs. China Asset Management | China Aluminum vs. Henan Shuanghui Investment | China Aluminum vs. Humanwell Healthcare Group | China Aluminum vs. Anhui Huaren Health |
| Zhejiang Construction vs. Tongyu Communication | Zhejiang Construction vs. Fujian Newland Computer | Zhejiang Construction vs. Cicc Fund Management | Zhejiang Construction vs. Kuang Chi Technologies |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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