Correlation Between Zhengzhou Coal and Foxconn Industrial
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By analyzing existing cross correlation between Zhengzhou Coal Mining and Foxconn Industrial Internet, you can compare the effects of market volatilities on Zhengzhou Coal and Foxconn Industrial 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 Foxconn Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhengzhou Coal and Foxconn Industrial.
Diversification Opportunities for Zhengzhou Coal and Foxconn Industrial
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhengzhou and Foxconn is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Zhengzhou Coal Mining and Foxconn Industrial Internet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foxconn Industrial 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 Foxconn Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foxconn Industrial has no effect on the direction of Zhengzhou Coal i.e., Zhengzhou Coal and Foxconn Industrial go up and down completely randomly.
Pair Corralation between Zhengzhou Coal and Foxconn Industrial
Assuming the 90 days trading horizon Zhengzhou Coal Mining is expected to generate 0.65 times more return on investment than Foxconn Industrial. However, Zhengzhou Coal Mining is 1.55 times less risky than Foxconn Industrial. It trades about -0.06 of its potential returns per unit of risk. Foxconn Industrial Internet is currently generating about -0.33 per unit of risk. If you would invest 1,349 in Zhengzhou Coal Mining on September 14, 2024 and sell it today you would lose (29.00) from holding Zhengzhou Coal Mining or give up 2.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhengzhou Coal Mining vs. Foxconn Industrial Internet
Performance |
| Timeline |
| Zhengzhou Coal Mining |
| Foxconn Industrial |
Zhengzhou Coal and Foxconn Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhengzhou Coal and Foxconn Industrial
The main advantage of trading using opposite Zhengzhou Coal and Foxconn Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhengzhou Coal position performs unexpectedly, Foxconn Industrial 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 Foxconn Industrial will offset losses from the drop in Foxconn Industrial's long position.| Zhengzhou Coal vs. Sanan Optoelectronics Co | Zhengzhou Coal vs. Tibet Huayu Mining | Zhengzhou Coal vs. Success Electronics | Zhengzhou Coal vs. Puyang Huicheng Electronic |
| Foxconn Industrial vs. China Sports Industry | Foxconn Industrial vs. Harbin Air Conditioning | Foxconn Industrial vs. Liaoning Chengda Biotechnology | Foxconn Industrial vs. Shanghai Yaoji Playing |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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