Correlation Between Zhengzhou Coal and Zoomlion Heavy
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By analyzing existing cross correlation between Zhengzhou Coal Mining and Zoomlion Heavy Industry, you can compare the effects of market volatilities on Zhengzhou Coal and Zoomlion 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 Zhengzhou Coal with a short position of Zoomlion Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhengzhou Coal and Zoomlion Heavy.
Diversification Opportunities for Zhengzhou Coal and Zoomlion Heavy
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zhengzhou and Zoomlion is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Zhengzhou Coal Mining and Zoomlion Heavy Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zoomlion Heavy Industry and Zhengzhou Coal 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 Zhengzhou Coal Mining are associated (or correlated) with Zoomlion Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zoomlion Heavy Industry has no effect on the direction of Zhengzhou Coal i.e., Zhengzhou Coal and Zoomlion Heavy go up and down completely randomly.
Pair Corralation between Zhengzhou Coal and Zoomlion Heavy
Assuming the 90 days trading horizon Zhengzhou Coal is expected to generate 10.86 times less return on investment than Zoomlion Heavy. But when comparing it to its historical volatility, Zhengzhou Coal Mining is 1.38 times less risky than Zoomlion Heavy. It trades about 0.01 of its potential returns per unit of risk. Zoomlion Heavy Industry is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 717.00 in Zoomlion Heavy Industry on October 30, 2024 and sell it today you would earn a total of 15.00 from holding Zoomlion Heavy Industry or generate 2.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Zhengzhou Coal Mining vs. Zoomlion Heavy Industry
Performance |
| Timeline |
| Zhengzhou Coal Mining |
| Zoomlion Heavy Industry |
Zhengzhou Coal and Zoomlion Heavy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhengzhou Coal and Zoomlion Heavy
The main advantage of trading using opposite Zhengzhou Coal and Zoomlion Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhengzhou Coal position performs unexpectedly, Zoomlion 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 Zoomlion Heavy will offset losses from the drop in Zoomlion Heavy's long position.| Zhengzhou Coal vs. Kweichow Moutai Co | Zhengzhou Coal vs. Contemporary Amperex Technology | Zhengzhou Coal vs. G bits Network Technology | Zhengzhou Coal vs. Beijing Roborock Technology |
| Zoomlion Heavy vs. Gan Yuan Foods | Zoomlion Heavy vs. Jiamei Food Packaging | Zoomlion Heavy vs. Shenzhen Noposion Agrochemicals | Zoomlion Heavy vs. Bus Online 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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