Correlation Between Zhengzhou Coal and Sinomach Automobile
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By analyzing existing cross correlation between Zhengzhou Coal Mining and Sinomach Automobile Co, you can compare the effects of market volatilities on Zhengzhou Coal and Sinomach Automobile 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 Sinomach Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhengzhou Coal and Sinomach Automobile.
Diversification Opportunities for Zhengzhou Coal and Sinomach Automobile
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhengzhou and Sinomach is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Zhengzhou Coal Mining and Sinomach Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinomach Automobile 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 Sinomach Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinomach Automobile has no effect on the direction of Zhengzhou Coal i.e., Zhengzhou Coal and Sinomach Automobile go up and down completely randomly.
Pair Corralation between Zhengzhou Coal and Sinomach Automobile
Assuming the 90 days trading horizon Zhengzhou Coal Mining is expected to under-perform the Sinomach Automobile. But the stock apears to be less risky and, when comparing its historical volatility, Zhengzhou Coal Mining is 1.2 times less risky than Sinomach Automobile. The stock trades about -0.06 of its potential returns per unit of risk. The Sinomach Automobile Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 685.00 in Sinomach Automobile Co on September 13, 2024 and sell it today you would earn a total of 1.00 from holding Sinomach Automobile Co or generate 0.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhengzhou Coal Mining vs. Sinomach Automobile Co
Performance |
| Timeline |
| Zhengzhou Coal Mining |
| Sinomach Automobile |
Zhengzhou Coal and Sinomach Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhengzhou Coal and Sinomach Automobile
The main advantage of trading using opposite Zhengzhou Coal and Sinomach Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhengzhou Coal position performs unexpectedly, Sinomach Automobile 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 Sinomach Automobile will offset losses from the drop in Sinomach Automobile's long position.| Zhengzhou Coal vs. Guangdong Shenglu Telecommunication | Zhengzhou Coal vs. Zhongtong Guomai Communication | Zhengzhou Coal vs. Metallurgical of | Zhengzhou Coal vs. Xinjiang Communications Construction |
| Sinomach Automobile vs. Kweichow Moutai Co | Sinomach Automobile vs. Contemporary Amperex Technology | Sinomach Automobile vs. G bits Network Technology | Sinomach Automobile 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 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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