Correlation Between China Railway and Ziel Home
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By analyzing existing cross correlation between China Railway Group and Ziel Home Furnishing, you can compare the effects of market volatilities on China Railway and Ziel 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 China Railway with a short position of Ziel Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Railway and Ziel Home.
Diversification Opportunities for China Railway and Ziel Home
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Ziel is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding China Railway Group and Ziel Home Furnishing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ziel Home Furnishing and China Railway 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 Railway Group are associated (or correlated) with Ziel Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ziel Home Furnishing has no effect on the direction of China Railway i.e., China Railway and Ziel Home go up and down completely randomly.
Pair Corralation between China Railway and Ziel Home
Assuming the 90 days trading horizon China Railway Group is expected to generate 0.6 times more return on investment than Ziel Home. However, China Railway Group is 1.66 times less risky than Ziel Home. It trades about 0.02 of its potential returns per unit of risk. Ziel Home Furnishing is currently generating about 0.01 per unit of risk. If you would invest 598.00 in China Railway Group on September 1, 2024 and sell it today you would earn a total of 43.00 from holding China Railway Group or generate 7.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Railway Group vs. Ziel Home Furnishing
Performance |
| Timeline |
| China Railway Group |
| Ziel Home Furnishing |
China Railway and Ziel Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Railway and Ziel Home
The main advantage of trading using opposite China Railway and Ziel Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Railway position performs unexpectedly, Ziel 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 Ziel Home will offset losses from the drop in Ziel Home's long position.| China Railway vs. Shanghai Jinfeng Wine | China Railway vs. Changchun Engley Automobile | China Railway vs. Haima Automobile Group | China Railway vs. Xinjiang Communications Construction |
| Ziel Home vs. Kweichow Moutai Co | Ziel Home vs. Contemporary Amperex Technology | Ziel Home vs. G bits Network Technology | Ziel Home vs. BYD Co Ltd |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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