Correlation Between Industrial and China Zheshang
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By analyzing existing cross correlation between Industrial and Commercial and China Zheshang Bank, you can compare the effects of market volatilities on Industrial and China Zheshang 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 Industrial with a short position of China Zheshang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and China Zheshang.
Diversification Opportunities for Industrial and China Zheshang
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Industrial and China is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and China Zheshang Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Zheshang Bank and Industrial 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 Industrial and Commercial are associated (or correlated) with China Zheshang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Zheshang Bank has no effect on the direction of Industrial i.e., Industrial and China Zheshang go up and down completely randomly.
Pair Corralation between Industrial and China Zheshang
Assuming the 90 days trading horizon Industrial and Commercial is expected to generate 0.96 times more return on investment than China Zheshang. However, Industrial and Commercial is 1.04 times less risky than China Zheshang. It trades about 0.06 of its potential returns per unit of risk. China Zheshang Bank is currently generating about 0.02 per unit of risk. If you would invest 546.00 in Industrial and Commercial on September 1, 2024 and sell it today you would earn a total of 69.00 from holding Industrial and Commercial or generate 12.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.45% |
| Values | Daily Returns |
Industrial and Commercial vs. China Zheshang Bank
Performance |
| Timeline |
| Industrial and Commercial |
| China Zheshang Bank |
Industrial and China Zheshang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and China Zheshang
The main advantage of trading using opposite Industrial and China Zheshang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, China Zheshang 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 Zheshang will offset losses from the drop in China Zheshang's long position.| Industrial vs. Fiberhome Telecommunication Technologies | Industrial vs. Chengdu Spaceon Electronics | Industrial vs. Zhongtong Guomai Communication | Industrial vs. Railway Signal Communication |
| China Zheshang vs. Cultural Investment Holdings | China Zheshang vs. Bus Online Co | China Zheshang vs. Holitech Technology Co | China Zheshang vs. Zotye Automobile 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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