Correlation Between Postal Savings and Zhongyin Babi
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By analyzing existing cross correlation between Postal Savings Bank and Zhongyin Babi Food, you can compare the effects of market volatilities on Postal Savings and Zhongyin Babi 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 Postal Savings with a short position of Zhongyin Babi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Postal Savings and Zhongyin Babi.
Diversification Opportunities for Postal Savings and Zhongyin Babi
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Postal and Zhongyin is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Postal Savings Bank and Zhongyin Babi Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongyin Babi Food and Postal Savings 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 Postal Savings Bank are associated (or correlated) with Zhongyin Babi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongyin Babi Food has no effect on the direction of Postal Savings i.e., Postal Savings and Zhongyin Babi go up and down completely randomly.
Pair Corralation between Postal Savings and Zhongyin Babi
Assuming the 90 days trading horizon Postal Savings Bank is expected to generate 0.59 times more return on investment than Zhongyin Babi. However, Postal Savings Bank is 1.68 times less risky than Zhongyin Babi. It trades about -0.06 of its potential returns per unit of risk. Zhongyin Babi Food is currently generating about -0.04 per unit of risk. If you would invest 542.00 in Postal Savings Bank on August 28, 2024 and sell it today you would lose (9.00) from holding Postal Savings Bank or give up 1.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Postal Savings Bank vs. Zhongyin Babi Food
Performance |
| Timeline |
| Postal Savings Bank |
| Zhongyin Babi Food |
Postal Savings and Zhongyin Babi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Postal Savings and Zhongyin Babi
The main advantage of trading using opposite Postal Savings and Zhongyin Babi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Postal Savings position performs unexpectedly, Zhongyin Babi 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 Zhongyin Babi will offset losses from the drop in Zhongyin Babi's long position.| Postal Savings vs. Eastern Communications Co | Postal Savings vs. Guangdong Shenglu Telecommunication | Postal Savings vs. Jilin Jlu Communication | Postal Savings vs. Yingde Greatchem Chemicals |
| Zhongyin Babi vs. China Petroleum Chemical | Zhongyin Babi vs. PetroChina Co Ltd | Zhongyin Babi vs. China State Construction | Zhongyin Babi vs. China Railway Group |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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